Short answer: leasing usually makes sense if you need to keep cash in the business, expect your space needs to change, or plan to stay less than several years. Buying can make sense if you plan to stay a long time, have cash for a down payment and closing costs, and want control over the building. There's no single right answer, so run the numbers both ways with your accountant before you decide.
I'm Carolyn Olivieri, a Doylestown-based industrial and flex specialist with KW Commercial. I have over ten years in distribution and still run a distribution business today. This is a question a lot of business owners ask, so here's how I'd think it through.
What the Bucks County market looks like
Newmark reported an average direct asking rent of $11.26 per square foot per year for Bucks County industrial space in the third quarter of 2026, with vacancy at 6.4%. (Source: Newmark, Greater Philadelphia Industrial Market Report, Q3 2026) Asking rent is a starting point. On most industrial leases you also pay your share of taxes, insurance and common area costs.
Leasing: the upside
- Less cash up front. You usually need a security deposit and first month's rent, not a down payment.
- Easier to move or grow when your lease ends.
- On many leases the landlord handles some big items, like the roof or structure. Which items depends on the lease, so read it.
- Your money stays in inventory, equipment and people.
Leasing: the downside
- Rent usually goes up each year under the lease.
- You build no equity in the building.
- At renewal, the landlord sets the terms, and you may have to move.
- You may need landlord approval for changes to the space.
Owning: the upside
- Your payment can be more predictable, especially with a fixed rate loan.
- You build equity as you pay down the loan, and you may gain if the property goes up in value.
- You control the building, including improvements and how long you stay.
- If you have more space than you need, you may be able to lease part of it out, if your loan and zoning allow it.
Owning: the downside
- You need a lot more cash up front.
- You pay for everything: taxes, insurance, roof, parking lot, HVAC and repairs.
- Your money is tied up in the building, and selling takes time.
- If your business outgrows the building or shrinks, you have to sell or lease it out.
How much cash you need
For a lease, plan for a security deposit, first month's rent, moving costs and anything you spend fitting out the space beyond what the landlord covers. Ask whether the lease is NNN (you pay your share of taxes, insurance and maintenance on top of rent) or gross (more of those costs are built into rent), since that changes your monthly total.
For a purchase, plan for a down payment, closing costs, inspections, an appraisal, legal fees and money set aside for repairs. Your lender will tell you how much down payment they need for your deal.
SBA 504 loans
If you're buying a building to run your own business from, ask about the SBA 504 loan. According to the SBA, it offers long-term, fixed rate financing for major fixed assets like buying, building or renovating buildings or land. Loans go through Certified Development Companies (CDCs) working with a senior lender, and 10, 20 and 25 year terms are available. It can't be used for working capital, inventory, or investing in rental real estate. (Source: U.S. Small Business Administration) A CDC or lender can tell you whether your business and project qualify.
Questions to ask before you decide
- How long do I really expect to stay in this space?
- Will my business need more or less room in five years?
- How much cash can I put into real estate without hurting the business?
- What is my total monthly cost to lease, including taxes, insurance and common area costs?
- What is my total monthly cost to own, including the loan, taxes, insurance and repairs?
- Does zoning allow my use at this address?
- What does my accountant say about the tax side?
Tax and legal questions should go to your accountant and attorney. I can help you find and compare real spaces and buildings.
Helpful reading: How Much Warehouse Space Do I Need?, What Does It Cost to Lease Industrial Space in Bucks County?, How Does Zoning Work for Warehouse Use in Bucks County? and Why Use a Tenant Rep Broker for Industrial Space?
FAQs
Is it better to lease or buy a warehouse?
It depends on how long you'll stay, how much cash you have and how much your space needs may change. Leasing keeps cash free and gives you flexibility. Buying builds equity and gives you control, but needs more cash up front.
How much does it cost to lease industrial space in Bucks County?
Newmark reported an average direct asking rent of $11.26 per square foot per year for Bucks County industrial space in the third quarter of 2026. Most leases also add taxes, insurance and common area costs.
Can I use an SBA 504 loan to buy a warehouse?
It may be an option if the building is for your own business. The SBA says 504 loans can be used to buy, build or renovate buildings or land, but not for investing in rental real estate. Talk to a Certified Development Company about your project.
Who should I talk to about the tax side of buying?
Your accountant. Tax and legal questions should go to your accountant and attorney.
Talk to a local industrial specialist
Thinking about leasing or buying industrial or flex space in Bucks County? Email Carolyn Olivieri, a Doylestown-based industrial and flex specialist with KW Commercial, at c.olivieri@kwcommercial.com
Carolyn Olivieri, KW Commercial