If you’re in the market to expand your industrial network, or even simply siting your first facility, you’ve probably heard about the “flight to quality”—the idea that modern tenants are fleeing older industrial properties in favor of the newest builds with the flashiest features. While this is happening, especially among large enterprises, that doesn’t mean older industrial buildings have no existing quality to offer.
Even better, it also means those who have flown the coop have left behind vacant facilities that might be perfectly suitable for a different tenant. The reality is that the overarching flight-to-quality narrative is doing a disservice to good buildings. For businesses in the market for additional industrial space, here are four common myths that might cause them to discount an older property and the reasons why they shouldn’t.
Myth #1: An older building won’t have enough power.
There is a persistent perception in industrial real estate that older facilities can’t provide sufficient power for modern needs because they will also have outdated utility infrastructure. However, the industry is quietly walking back this perception as buildable greenfield sites become harder to find, and utility connection timelines get increasingly longer.
The reality is that existing electrical service is now the White Whale for industrial real estate assets, and older manufacturing and industrial sites are where much of it already exists. Even if the assets require some updating, those upgrades take much less time than:
- Establishing new grid interconnections, which are running 4 – 7 years in several major markets.
- Waiting for lead times to source high-capacity transformers, which have expanded to 3 – 4 years since 2021.
- Acquiring medium-voltage switchgear, which is effectively sold out through 2028.
Through this lens, a defunct plant from the 1980s with existing heavy service and redundant feeders looks much more viable.
Myth #2: Retrofitting costs just as much as a greenfield build.
It’s commonly believed that a facility retrofit can cost as much as or more than new construction. However, considering how much metal an industrial greenfield build takes, this argument is easy to quash. Structural steel costs climbed 17% and aluminum more than 30% in 2025, and tariffs on imported steel and aluminum can run as high as 50%, depending on the source.
According to data from iFactory AI, brownfield renovations usually cost $6 to $22 million, while greenfield builds cost an average of $12 to $55 million, and 70% of greenfield projects exceed their budget due to overruns on labor, permitting, and equipment lead times.
Myth #3: Finding new supply is easier than retrofitting existing stock.
This myth is a bit two-sided. Yes, if a brand-new facility is available within the organization’s budget, setting up operations will ultimately be easier. But the flip side is that industrial completions in Q2 2026 fell to their lowest level since 2016. Furthermore, the construction pipeline is still 61% below its 2022 peak, even after two quarters of steady recovery.
Waiting around and hoping to secure an unspoken-for speculative build may work for some businesses, but organizations looking to expand quickly likely cannot afford to. Additionally, those who pursue an existing industrial asset sooner will have better options to choose from.
Myth #4: Obsolete means obsolete forever.
A facility’s age might be fixed, but its function isn’t. Aging industrial buildings can be upgraded to suit the needs of modern tenants. Owners and developers are even managing to solve problems that were once considered structural and unchangeable. For example, several niche contractors have entered the industrial market offering services to raise roof heights to accommodate taller racking and robotics systems.
Obsolescence is only a description of a legacy building’s current configuration. It shouldn’t be taken as a verdict on its future viability.
“The problem with the flight-to-quality trend is that it assumes a building’s quality only comes from the date on the cornerstone,” says Frank Crivello, founder and chairman of Phoenix Investors. “We look at it differently. Quality means power; it means location; and it means a solid structure that can handle a retrofit. Plenty of buildings built 10, 20, or even 50 years ago have all three of those things, and the companies figuring that out are getting up and running much faster than those starting with a fresh build.”
Age Is Just a Number
Of course, none of this means that every old building or brownfield site is a good fit for every operation. What it does mean is that the screening criteria many companies use when looking for new sites are simply too narrow. Before ruling out a property based on its age, consider what it would take to make it work and what the alternative might look like in terms of cost and years.
Phoenix Investors has a demonstrable history of successfully renovating brownfield sites and outdated industrial structures for modern use. For more information on this process and how we can help, please don’t hesitate to contact us.
About Phoenix Investors
Founded by Frank P. Crivello in 1994, Phoenix Investors and its affiliates (collectively “Phoenix”) are a leader in the acquisition, development, renovation, and repositioning of industrial facilities throughout the United States. Utilizing a disciplined investment approach and successful partnerships with institutional capital sources, corporations, and public stakeholders, Phoenix has developed a proven track record of generating superior risk-adjusted returns while providing cost-efficient lease rates for its growing portfolio of national tenants. Its efforts inspire and drive the transformation and reinvigoration of the economic engines in the communities it serves. Phoenix continues to be defined by thoughtful relationships, sophisticated investment tools, cost-efficient solutions, and a reputation for success.
Mr. Frank P. Crivello began his real estate career in 1982, focusing his investments in multifamily, office, industrial, and shopping center developments across the United States. From 1994 to 2008, Mr. Crivello assisted Phoenix Investors in its execution of its then business model of acquiring net lease commercial real estate across the United States. Since 2009, Mr. Crivello has assisted Phoenix Investors in the shift of its core focus to the acquisition of industrial real estate and data center assets throughout the country.
Given his extensive experience in all aspects of commercial real estate, Mr. Crivello provides strategic and operational input to Phoenix Investors and its affiliated companies.
Mr. Crivello received a B.A., Magna Cum Laude, from Brown University and the London School of Economics, while completing a double major in Economics and Political Science; he is a member of Phi Beta Kappa. Outside of his business interests, Mr. Crivello invests his time, energy, and financial support across a wide net of charitable projects and organizations.