Leasing space in a multitenant warehouse is becoming an attractive option for companies that want flexibility and easy access to markets.

With Columbus' booming business economy, it's also opening more and more doors for multitenant warehouse developers.

Ray Boll, a partner with R/J Boll Realty Ltd. Has specialized in leasing and selling commercial and industrial real estate for 25 years. He believes Columbus is becoming a magnet for these warehouses for practical reasons.

Foremost is Columbus' status as a service center. Companies like having their products within a certain radius of where they need to be distributed and/or sold. "There are a variety of tenants, who are service-oriented, and this allows them to get their product to the manufacturer/retailer…and ultimately to the user as soon as possible," Boll said.

The other major reason multitenant warehouses are becoming popular is their flexibility. "There's growth potential for both smaller and larger tenants, that's why it makes sense," Boll said.

Westbourne Morrison L.P., an affiliate of Rudolph Construction Co., is in the third and fourth phases of a $2.15 million office/warehouse project on 23 acres on the East Side. The first two phases (four buildings) were completed late last year at a cost of $2 million. They are filling up within five months, said Westbourne general partner James Havens, who believes the key is diversification.

With construction costs continuing to rise, both Boll and Havens say it's more economical to build larger warehouses because per square-foot costs go down over a large area.

The rental rate per square foot is also dependent on how much space the tenant uses for offices rather than for storage. Havens stays away from building those kinds of warehouses. "It's the most volatile segment of the real estate business," Havens said. "There tends to be too much speculation on it."

The Rosenberg Real Estate Equity Fund, a national pension fund adviser, owns 85 percent of the West Belt Business Park. It has a different approach to renting its existing 3 million square feet of office/warehouse space.

"Our strategy is to retain for longer-term leases, preferably at least three to five years," said Phil Schneider, RREEF's district manager. "The worst thing is downtime, because that's money coming out of the owner's pocket."

With a fairly stable 55 tenants in 21 buildings, RREEF's objective is to make constant improvements in modifying space. This can include dividing walls, loading doors, plumbing, heating, electricity and air conditioning. Typically leases are for 5,000-50,000 square feet. They go to clients like Best Buy and Frigidaire Co. RREEF is able to keep costs competitive within the marketplace - between $4 and $4.25 per square foot excluding taxes, insurance and common area maintenance - regardless of the space obtained, Schneider said.

Since buying its first 2 million square feet of space from LaSalle Partners in April of '94, RREEF has maintained 90 percent occupancy at Westbelt "because it provides the tenant maximum flexibility to accommodate future needs," Schneider said. Although Schneider said "development is not RREEF's forte," the company is considering building a 90,000 square-foot multitenant warehouse on 5 of 20 acres it owns within Westbelt on Dividend Drive.

With a prime location off I-270 as well as easy access to I-70, Westbourne Morrison L.P. is considering more development in the next three to five years on 13 acres it owns on the south side of Westbourne Avenue.