WareSpace has acquired a five-building industrial portfolio from an institutional real estate investor, marking the company’s first portfolio-level transaction and its largest acquisition to date.
The portfolio spans approximately 441,000 square feet across Austin, Southern California’s Inland Empire, San Diego and Miami. Once the properties are fully converted, WareSpace expects them to contain nearly 500 micro-bay warehouse units ranging from approximately 200 to 2,000 square feet.
Financial terms of the acquisition were not disclosed.
The transaction expands WareSpace into four industrial markets where smaller businesses often face limited access to appropriately sized warehouse and operating space. The company primarily serves residential contractors, service providers, e-commerce brands, distributors and other businesses that need more infrastructure than a traditional self-storage unit but substantially less space than a conventional industrial lease.
WareSpace’s facilities provide small industrial units under flexible lease arrangements, with utilities, property maintenance, building access and delivery management incorporated into the offering. The company’s properties also include industrial features such as loading docks, racking and climate-controlled workspaces.
Traditional industrial properties are generally designed for larger tenants that can lease tens of thousands of square feet for extended periods. This structure can leave smaller companies choosing between taking more space than they need, operating from unsuitable locations or managing inventory and equipment across multiple facilities.
WareSpace seeks to address that gap by dividing larger or underutilized industrial buildings into smaller, move-in-ready units. Its co-warehousing model combines private warehouse spaces with shared infrastructure and professionally managed operations.
The newly acquired portfolio will include 223 units across two locations in Austin, 90 units in the Inland Empire, 80 units in San Diego and 91 units in Miami.
Austin has experienced significant growth across technology, construction, logistics and consumer services, creating demand from smaller businesses requiring warehouse and fulfillment space. The Inland Empire is one of the country’s largest distribution and logistics markets, but available industrial properties have traditionally been oriented toward major retailers and logistics operators.
San Diego’s limited industrial inventory and high property costs can make it difficult for smaller companies to secure functional space near their customers. Miami similarly serves as an important trade, e-commerce and distribution market connecting the United States, Latin America and the Caribbean.
WareSpace said the four markets are among the most supply-constrained locations for small industrial tenants, making them attractive areas for expanding its micro-bay platform.
The acquisition increases WareSpace’s national portfolio to 30 locations. The company said it has previously transformed underutilized and outdated industrial properties into operating hubs for local businesses.
WareSpace manages the acquisition, development, construction, financing, operations, marketing and leasing of its properties through a vertically integrated platform. Maintaining those functions internally is intended to give the company greater control over property conversions and the experience provided to tenants.
The transaction follows WareSpace’s recent $700 million capital raise, which increased its capacity to pursue larger acquisitions and expand its national presence. The new funding is helping the company target both individual properties and portfolios that can be converted into co-warehousing facilities.
WareSpace’s first 27 locations were primarily developed through individual property acquisitions. The five-building deal demonstrates the company’s ability to acquire multiple assets in a single transaction while applying its existing operating model across several markets.
The company said the portfolio acquisition does not represent a change in its strategy. Instead, it allows WareSpace to expand more quickly while continuing to focus on industrial properties that can be reconfigured for small businesses.
Co-warehousing has increasingly attracted interest from institutional investors as the number of e-commerce businesses, contractors, local service companies and independent distributors continues to grow. Many of these businesses require secure inventory storage, loading access and operational space but cannot justify the cost or commitment associated with a conventional warehouse.
Shorter lease terms may also benefit growing companies whose space requirements can change quickly. A business can begin in a small unit and potentially move into a larger space as its inventory, workforce and customer base expand.
For property owners and investors, converting older or challenged industrial buildings into smaller units can broaden the tenant base and increase utilization. WareSpace’s model is designed to turn these properties into multi-tenant facilities serving dozens or hundreds of businesses.
The acquired properties will support close to 500 small businesses when fully developed and occupied. WareSpace believes demand from local operators will continue to support its expansion as entrepreneurs seek affordable alternatives to traditional industrial leases.
KEY QUOTES:
“This acquisition deepens our presence in some of the most supply-constrained industrial markets in the country. These are four of the tightest markets for a small operator to find space, which is what attracted us to these assets. Small businesses have been underserved by industrial real estate for too long, and we’re proving there’s real institutional appetite for a model built around them. By providing all-inclusive pricing, short lease terms and move-in-ready climate-controlled space with all the industrial amenities like loading docks and racking, we are truly providing small businesses with the perfect space for them to run their business.”
Levi Cohen, Co-Founder and CEO of WareSpace
“This transaction is not a shift in strategy; it is a continuation of what we’ve been building. We’ve taken underutilized industrial assets and transformed them into functional and energized hubs for local small businesses. These are mission-critical companies that are the backbone of their local economies, but their space requirements are often overlooked by traditional industrial landlords. This portfolio acquisition allows WareSpace to accelerate the expansion of that model while reinforcing the strong demand and market validation we’ve seen across our first 27 locations.”
Joseph Ely, Co-Founder and COO of WareSpace
