How much does it cost to build a warehouse? Complete guide in 2022

How much does it cost to build a warehouse in 2022

Since warehouses can be utilized as storage facilities, shipping hubs, machine shops, or even an office, they are typically a smart property investment for businesses.

New warehouse designs must safeguard a company’s financial investments. Soft, hard, long-term, as well as financial expenses all need to be taken into account in modern warehouses.

As you might expect, there are numerous materials, designs, and other considerations that might affect the cost of building a warehouse.

It sounds pricey to build a warehouse, right? But you can still save a ton of money if you partner with the right company.

In today’s post, we’ll walk through “how much does it cost to build a warehouse” to help you no more worry at the first steps of construction planning. 

How much to build a warehouse in 2022

Build a warehouse in 2022

Construct a 5000 sq ft warehouse

5,000 square feet or a turnkey 50×100, the warehouse will run you about $312,500 along with the cost of land and grading, but there are a lot of variables that might change the price.

The cost of the building’s shell—its construction, foundation, and concrete slab—will be about $20 per square foot and $100,000 in total.

Typically, you’ll pay between $7 and $12 per square foot, or $35,000 and $72,000 in total, for the steel building.

A small or lower-medium sized company would be well served by a structure that is 5,000 square feet in size.

Construct a 10,000 sq ft warehouse

A turnkey 100×100 or 10,000 sq ft warehouse will cost roughly $625,000 in addition to land and grading.

The cost of a 10,000-square-foot warehouse shell is about $200,000.

Typically, the steel building costs between $60,000 and $100,000 in total, or $6–$10 per square foot.

Construct a 20,000 sq ft warehouse

In addition to land and grading costs, the cost of a turnkey 20,000 square foot, or 100×200 warehouse is about $1,250,000.

The cost of constructing the shell (construction, concrete, plus erection) will be approximately $400,000.

Pre-engineered steel buildings typically cost between $100,000 to $180,000 in total or $5 to $9 per square foot.

Construct a 50,000 sq ft warehouse

A 50,000-square-foot warehouse costs around $3,125,000 turnkey, excluding land and grading.

A typical 50,000-square-foot warehouse shell costs $1,000,000.

The price of the metal building in itself is $4–$8 per square foot or $200,000–$400,000 in total.

Total Warehouse cost in 2022

Construction of a warehouse generally costs you around $15 per square foot.

Smaller 30×40 constructions can cost as little as $15,000, while a 50,000-square-foot fulfillment center can cost as much as $475,000 in pricing. This number includes the base metal building package, transportation, construction, as well as foundation.

Total Warehouse cost

Here is an analysis of warehousing expenses per square foot for the estimated total costs. A building’s size is inversely correlated with its cost per square foot.

Metal Building

Between $3.50 and $15 a square foot.

Shell

Between $19 and $25 a square foot.

Turnkey

Between $55 and $70 a square foot.

Soft Costs

Soft costs refer to the expenses for insurance, licenses, taxes, legal fees, engineering, architectural drawings, non-permanent furniture (including chairs and desks), moveable equipment (like a forklift), along with other expenses not associated with hard costs.

Hard Costs

Hard costs are those incurred during the “brick-and-mortar” construction of a warehouse. The hard expenditures consist of labor, materials, energy,  plumbing, sewer, grading (or leveling), parking lots, HVAC, and LEED certifications.

Companies regularly wonder, “How much does it cost to construct a warehouse.” They refer to the actual costs.

Hard cost is the only one of the four cost categories, therefore it cannot, nevertheless, cover the entire cost (soft cost, hard cost, long-term cost, and financing cost).

Long-term Costs

The whole cost of the warehouse building includes utility costs, ongoing maintenance, and upkeep.

The cost of a warehouse as a whole will be significantly impacted by these factors. The warehouse’s insulation will enable you to significantly reduce your energy costs.

Although the initial cost is higher, the monthly cost is less.

Calculate when more insulation will pay for itself in terms of lower monthly costs.

If it is not more than ten years, it is definitely worthwhile to do so.

Financing Costs

Financing fees are the sum you pay to the bank for the cost of borrowing for your construction project.

If your interest rate, as well as fees, are lower, your financing costs will be lower in price.

Additional Costs to Consider

The expenditures for any racking, shelving, equipment, security, forklifts, or specific systems that your warehouse may require are some additional expenses to take into account.

Automating warehouses is something else you might want to consider. Robots, software, and automatic package retrieval systems can all be categorized under this.

The cost of your overall warehouse building project would increase as a result of the majority of these factors, which are not included in construction cost calculations.

Factors Affecting the Cost of Warehouse Construction

Considering what meets your needs when choosing the tools you employ and the professionals you seek advice from:

Warehouse size

How much floor space will be required to store your goods? It will, of course, depend on the materials you employ. For steel warehouses, the cost of building per square foot ranges from $7.61 to $10.25. The cost per square foot of a warehouse is affected by location and necessary utilities in addition to the materials utilized.

Location

The costs of land and taxes will vary depending on the city, state, and zip code you decide to construct in. The cost of your warehouse per square foot also relies on where you are.

Type of warehouse

Do you want to build a huge warehouse with numerous loading docks or a modest one with just a garage? How many entrances, elevators, bathrooms, and windows are required? All of these elements will affect the price of building a warehouse, so when determining your budget, be sure to have a detailed plan prepared.

Types of equipment

Considering the price of the computers and other specialist tools you’ll require. Be sure to account for the cost of forklifts’ batteries, attachments, power supply, and maintenance.

A broken forklift could cost you several days of labor and severely hurt your bottom line. It is beneficial to have a service expert and replacement parts close by if you want to keep yours in top condition.

The kind of professionals

To finish construction, you’ll probably need an architect, an engineer, and a lawyer. Any specialized assistance will be included in the price of building your warehouse.

The required additional cost rates may change

The sort of utilities (natural gas, solar power, etc.), insurance, permits, taxes, and the building required to meet health and fire safety laws.

Best Building Materials for Warehouse

Steel structures outperform various other materials that are commonly regarded for commercial construction in terms of durability, longevity, and cost. However, you can also build your warehouse using some additional resources. Knowing the kind of materials you want to employ is one of the initial steps in calculating the cost of building your future warehouse.

The many materials that can be utilized to construct a warehouse have some advantages. For instance, insulated concrete provides insulation and lasts forever (or for a very long time).

Here are a few of your choices along with an approximate estimate of the cost per square foot.

• Stud Frames: $20-$40 per sq ft.
• Tilt-Up construction method: $25-$40 per sq ft.
• Steel Frames: $10-$20 per sq ft.

Build a Warehouse: Step-by-step

A warehouse takes a long time to construct. Four key stages are distinguished in construction projects.

Build a Warehouse process

Initiation

A feasibility study is an initial stage. It merely wants to know whether the scope of the project, timetable and budget are all in agreement. For instance, it makes no sense to expect to construct a 1 million square foot factory in a week, but it is fair to expect to construct 808 garden sheds.

Pre-Construction

Pre-construction activities include obtaining licenses, designing the project, selecting a general contractor, and procurement (acquiring the materials).

The most important step in preparing a prefabricated steel warehouse building for your business’s expanding storage needs is without a doubt the planning stage.

The development of warehouse designs has advanced significantly in the modern, giving rise to choices that did not exist before. For your planned storage needs, a pre-engineered building maker will offer elements that make planning and construction a smooth procedure using sample blueprints and designs.

Before starting to develop a steel warehouse building, you must take into account a few important factors, including the following:

Building Code 

Ensure that you are familiar with your local codes. Call your local building department and let them know you want to put up a metal building at the specified area.

The exact code information must be provided to the metal building provider by you, the client. Investigating setbacks and other code requirements that would forbid the use of a metal building or any other construction on a certain lot is also a smart idea.

Building Dimensions

The height of the building, the location of doors and windows, the preferred color for the walls, roof, and trim, as well as the building’s proportions, should all be noted.

This is crucial when creating a warehouse since the dimensions will ultimately define what can fit within your warehouse and because doors for large machines need to be the proper size.

Construction

You eventually break ground and start physically building your warehouse at this step. The actual construction can begin once the parts are delivered and the foundation is prepared. You can erect your building on your own with the guidebook or with the assistance of an erector.

Post-Construction

The post-construction phase includes activities like demobilization, punch lists, and documentation closeouts.

How Much Time Is Needed to Build a Warehouse?

It’s important to consider how long it takes to construct a warehouse because it directly affects the cost of your construction project.

The World Bank said that in 2019, it takes 81 days on average to build a warehouse in the United States.

The amount of calendar days required to finish the necessary steps for building a warehouse is how they define “building time.”

Your actual mileage may change depending on factors including design, rezoning, grading, weather, size, interior build-out needs, and modifications to the design made by you or your local government.

81 days seems to be a reasonable average duration, but we have no knowledge of your specific project.

Recommendations for Constructing a Warehouse that can Improve Efficiency

Tips for Building a Warehouse that can Improve Efficiency

Maximize capacity

The price per sq foot and ways to get the most out of each square should be your first priorities. Every empty square foot is a missed opportunity.

How quickly can you transfer inventory throughout the facility, secondly? Make it a rule of thumb to store inventory for no longer than 90 days and to turn over finished products in no more than 2 weeks.

Use the most advanced infrastructure technology

Your production may succeed or fail based on the equipment you choose. There are several things to take into account:

• Possibilities for automation
• Processing and installation time
• Practices of lean manufacturing

Consider your location

The location you choose will rely on the primary source of revenue for your current company. It is important to keep in mind a number of general criteria, including rules and regulations, as well as accessibility to roads, ports, and airports in connection to potential expansion and costs.

The key is to consider both the distribution facility and the goals of your company. It’s also crucial to evaluate your primary consumers and how their experience will change if you decide to create an entirely new warehouse in a different area.

Think about the architecture

The following considerations must be made while developing a warehouse: building height, plot size, service requirements, structural complexity, access, and visibility.

Think about the architecture

Efficiency is required throughout the construction process, which includes the type of materials used, the length of the project, and the design requirements.

Additionally, think about future adaptability in case you decide to sell or rent the area.

Put health and safety first

Put this at the top of your priority list. Safety considerations center on:

• The place
• The occupancy
• Procedures
• Potential dangers
• Fire storage areas
• Tobacco ventilation
• Safety from fire
• The upkeep

The aforementioned factors significantly increase the cost of the warehouse, so each one must be managed with attention.

Think about industry structures and recent innovations

The only thing you can plan for with certainty is change, so make your space as adaptable as you can.

A warehouse management system (or WMS) is an excellent tool for monitoring things like the number of items coming into and going out of the building and the complexity of the company.

We suggest a consulting session to come up with ideas and perfect the technology needed for the project.

Keep in mind your investment targets

You must assess your medium- and long-term goals from a financial perspective. Review your business plan and take into account the following:

• Tax implications
• Total operating expenses
• Time value of money

Create a financial model that takes into account EVERY variable to make sure it supports your company’s goals. Be cautious because there are always unanticipated factors (minimum 5%, contingency).

Refine your space planning together with your medium-term expansion plan after performing your initial planned order of magnitude costing.

The following factors contribute to the highest building costs for warehouses:

• The structural steel roof weight
• The sheeting’s specifications
• Floor installation and specification
• Installation and specification of walling
• The fire safety standards
• Sustainable and effective yard space

Find the top team

It’s essential to work with a skilled, knowledgeable crew to make sure the warehouse runs as efficiently as possible.

The Bottom Line

So you’ve got to know “how much does it cost to build a warehouse?”. Then, your warehouse project is almost ready to get started.

A number of factors, the most prevalent of which is the rising demand for industrial space, affect the price of warehouses. Your warehouse’s dimensions and location also have an impact on pricing.

We hope that this article has given you all the details you require to begin developing your construction strategy, and of course, the cost of building a warehouse.