How to Lease your warehouse to Amazon?
Amazon.com Inc. is e-commerce, cloud computing, digital streaming, and artificial intelligence-focused American multinational technology firm. Every industrial real estate investor has dreamed of having tenants like amazon for their property. It has been called “one of the world’s most important economic and cultural forces,” as well as “one of the most valuable brands”. Most of us have already used or visited amazon.com to purchase something online.
AMAZON WAREHOUSES EMERGING ACROSS THE COUNTRY
Amazon India has approximately 60 fulfillment centers (FCs) throughout 15 states with a total storage capacity of over 32 million cubic feet, including a specialized network of FCs for major appliances and furniture, as well as Receive Centers.
Amazon has opened a new huge warehouse in Pune and expanded another in Mumbai, bringing the total number of large warehouses in Maharashtra to ten, with a total capacity of nine million cubic feet.
In Bengaluru, they also opened their largest fulfillment center, with a storage capacity of more than 2.4 million cubic feet. The company recently closed 6 lakh sq ft of warehouse property in India’s largest logistics cluster, Bhiwandi in the Mumbai Metropolitan Region, and another one million sq ft of warehouse space from ESR in the Shamshabad neighborhood of South Hyderabad.
REQUIREMENTS OF AMAZON FOR LEASING A PROPERTY AS A WAREHOUSE
Location: They need to be close to the city in order to meet customer demands and make same-day deliveries, as well as reduce last-mile delivery costs and time.
Size: They require massive warehouses – in a Tier 3 city, an Amazon warehouse could be as large as 50,000 square feet, whereas, in a Tier 1 city, it could be as large as 5,00,000 square feet.
Specifications: These warehouses are being automated to operate with the least amount of human interaction, work, and interference, which means the specifications must be top-notch to meet all government compliances, and the sheds must be perfect in every way to allow Robots to operate with the greatest precision. This means that floor levels must be excellent throughout the space, there must be a significant number of loading bays and parking places, and fire and safety regulations must be met, among other things.
Budget: Amazon needs cost-effective Real Estate to support its operations in offering the best value, hence the rental must be the lowest in the market.
Points to keep in mind while Leasing Warehouse to Amazon :
- You must have a handsome amount in hand to develop a facility to their specifications.
- You must have your own purchased land.
- Your land should open on a minimum of 80 ft wide road.
- Your land title should be clear and have approval for constructing the warehouse.
- Expect a return on investment (ROI) of roughly 7-8 percent, which is significantly lower than industry averages.
- Be prepared to sign a contract that is skewed in their favor – this is standard practice for any worldwide top-level corporation.
