- The building is the asset here, which reverses the analysis used on yards and land.
- No honest broker discusses value before seeing the rent roll, the unit mix, the rollover schedule and the real expense structure.
- Gross, modified gross and triple net are not interchangeable. Which one you use changes the income a buyer underwrites.
- This is the tightest asset class in South Florida, and a published vacancy figure understates how hard space actually is to find.
- Any surplus yard is priced as upside, and on the right site it is worth more than the last unit of building.
The analysis runs the other way round
Everything Phil says about industrial outdoor storage inverts here. On a yard, coverage is something you want low and the building is an amenity. On small bay and flex, the building is what is being bought, and it is underwritten on rent per square foot, unit mix, clear height and loading.
That matters because the two products often sit on the same street, and a broker who prices both the same way is wrong about one of them. A generalist who prices a truck yard on building square footage gets it badly wrong. The mirror image is pricing a multi-tenant flex park on land value and leaving the income story out.
What gets examined before anybody says a number
Phil does not put a value on a small bay or flex property before seeing these. Neither will any serious buyer, and a broker who quotes you a number without them is guessing in front of you.
The rent roll
Every unit, every tenant, the rent, the start and end dates, the escalations, the options and the security deposits. Buyers underwrite the rent roll, not the marketing summary of it.
The unit mix
How many units, at what sizes, and how many of each size. A park of small units with a deep local tenant base behaves differently from one dominated by two large ones, and it is priced differently for the same total square footage.
The rollover schedule
What proportion of income expires in the next twelve, twenty four and thirty six months. Concentrated rollover is either the risk or the opportunity, depending on where the rents sit against market.
The real expense structure
Gross, modified gross or triple net, and what each tenant genuinely reimburses. This is the number most often reported optimistically, and the one a buyer checks first.
The building facts that move the number
- Clear height. The difference between a bay a tenant can rack and one they cannot changes who will lease it and at what rate.
- Loading. Grade level roll-up doors against dock high, how many per unit, and whether a tenant can actually receive a delivery without blocking the drive aisle.
- Power. Service per unit, and whether it supports the trades that actually want small bay space.
- Office finish ratio. How much of each unit is finished office, and whether that matches what local tenants want or what a previous owner wanted.
- Parking and circulation. Small bay parks live or die on whether vans and box trucks can get in, unload and leave while other tenants are doing the same.
- Sprinkler and life safety. What the system supports and what it restricts a tenant from storing.
Surplus yard is the upside nobody prices
Where a small bay or flex property has fenced yard beyond what the parking requirement consumes, that area is worth pricing separately rather than treating as landscaping.
What decides whether it is real upside is the same zoning question that governs an IOS yard. Does the code permit outdoor storage of vehicles, trailers, containers or equipment on that portion of the site, by right, by special exception, or as a documented nonconforming use? A yard a tenant can legally use is income. A yard they cannot is a maintenance line item.
On the right site the surplus yard is worth more than the marginal unit of building, and it is regularly left out of the marketing entirely.
What a vacancy figure does not tell you
Small bay is the tightest asset class in South Florida, and county vacancy statistics understate the tightness rather than measure it. Those figures are compiled largely from institutionally tracked buildings, and a great deal of the small bay stock is privately held and never appears in the survey.
The practical effect is that a tenant looking for a modest unit in Broward or Miami-Dade often has very few genuine options, which is not what a single published percentage conveys. Read county figures as context for a conversation and not as a description of your park.
This site does not publish a rent or a vacancy number on this page on purpose. Where figures are quoted, they carry a source and a date. Anything else is decoration.
Who is bidding
- Private and family capital. The core buyer for multi-tenant small bay, attracted by granular income and low turnover.
- Exchange buyers. Working to a deadline, paying for certainty and a clean file, and often willing to accept a lower going in yield to hit it.
- Owner users. Buying one or two units for their own business and frequently paying the strongest number per foot, because they are buying utility rather than a yield.
- Value-add buyers. Hunting concentrated rollover where in place rents sit below market, or an under used yard the current owner never monetised.
What to have ready
Have these in a folder
- 01Rent roll and every leaseIncluding amendments, options and side letters. Missing amendments surface in due diligence and cost time.
- 02Two or three years of operating statementsWith the recoveries broken out so a buyer can see what tenants actually reimburse.
- 03A unit plan with sizesMeasured, not estimated, and reconciled to the rent roll.
- 04Building specificationsClear height, door counts and types, electrical service per unit, sprinkler system and roof age.
- 05Capital historyRoof, paving, electrical and any structural work, with dates and warranties.
- 06The zoning read on any surplus yardWhether outdoor storage is permitted there, which decides whether the yard is income or a cost.
When Phil is the wrong call
If the property is really an office park with a roll-up door, the buyer pool is an office buyer pool and you want an office broker. The test is what the tenants actually do in the space rather than what the marketing calls it.
If it is a single tenant building with a long flat lease well below market, that is an annuity, and it gets priced as one. Phil will say so rather than market a yield story that the lease does not support.
The process, in order
Seven steps, in the sequence they actually happen. Most of the value is created in the first three, before the property is ever shown.
How the sale runs
- 01Assemble the rent roll and every leaseInclude amendments, options and side letters, and reconcile the unit sizes to a measured plan.
- 02Separate the real expense structureEstablish which leases are gross, modified gross or triple net, and what each tenant genuinely reimburses.
- 03Map the rolloverWork out what proportion of income expires over the next twelve, twenty four and thirty six months and where those rents sit against market.
- 04Document the buildingClear height, loading, power per unit, sprinkler system, roof age and the capital work already done.
- 05Price any surplus yard separatelyGet the zoning read on whether outdoor storage is permitted there, because a usable yard is income rather than landscaping.
- 06Position for the right buyer poolDecide whether the story is granular stabilised income or a value-add rollover play, and market accordingly.
- 07Run the process and close itTake it to private capital, exchange buyers, owner users and value-add buyers, then manage the dates through to closing.
Read next: IOS yards, Truck parking and terminals. If you are earlier than that, start with what your property is worth or how to choose a broker.