Tucked in a former textile-manufacturing section of the Philadelphia's East Falls section, an open warehouse space is home to a paintball-goggle maker, an online glass distributor, a seamstress, and other small-business founders.

It's the two-year-old, newly-expanded Philadelphia center of WareSpace, which is taking the U.S. warehouse boom into the small-business sector.

The Columbia, Maryland-based company, founded by veteran developers and financed by private-equity investors, adapts unwanted former factory and office buildings into rows of mini-warehouses. Demand is strong, two of the company's founders said on a recent visit to their East Falls space.

It took less than two years to fill the first 100 bedroom- and living-room-sized warehouse spaces at the East Falls center. The company opened another section in January, with 30 more spaces, and has filled more than half already.

Prices start around $700 a month, for spaces ranging from 200 to 2,000 square feet. The payment includes building maintenance, real estate taxes, property insurance, WiFi, dumpster use, package receiving, and cleaning.

"We offer full-infrastructure commercial space, in the place between where self-storage stops and traditional warehouses begin," said Joseph Ely, cofounder and chief operating officer of WareSpace.

The idea is to make moving in a one-day task, and consolidate all the services that make leasing space a headache for small business owners.

Cohen and Ely worked together in their previous careers at Beco Management, a Maryland-based real estate developer, and started WareSpace in 2022 with more than $100 million from Jadian Capital, a Stamford, Conn.-based real estate investor.

What's inside?

A walk through the East Falls building found some tenant-owners at work.

Edgardo and Wilma Borges were stretching fabric over padded frames at Alora's Upholstery. They have been reupholstering furniture since they were students in Anthony Fittipaldi's shop class at Thomas Edison High School in 1990.

Two years ago they moved their business, named for their granddaughter, from their home to WareSpace, and they have already expanded.

"The furniture you buy new today, people know it doesn't last," Edgardo said. "They know when they buy from us, it's going to last, and pay for itself."

Will Wu has been running EZ Design, a business-to-business distributor of fancy whisky glasses and decanters, since graduating from Stony Brook University three years ago with a degree in philosophy and math.

"I wanted to try something different from academia," he said, so he moved to Philadelphia and began looking for space when his wife got into a University of Pennsylvania graduate biotech program. He found WareSpace in a Google search.

Wu says he sources his glass from people his cofounder knows in China, where U.S. tariffs are scheduled to double soon, to 40%. He'll stay with his sources for now, "because I trust them," but he hopes in time the business will grow to where it's sourcing from additional places. He's confident in the future: "I'm looking for a new etching machine."

Ely says his little-warehouse industry has been boosted by the push by Washington, D.C. policymakers to "bring manufacturing back to America" and the rapid construction of highly-visible, full-size warehouses along major highways by big shippers like Amazon.

More than a quarter of WareSpace tenants — in Philadelphia and nationally — are e-commerce businesses finishing and shipping value-added products to buyers; others are building contractors, vending-service suppliers, furniture repair, and sign maker shops.

National competitors include mini-warehouse managers ReadySpaces, Saltbox, and Cubework. Cohen says WareSpace is unusual in that it buys all its centers; investors are betting not just on its revenue but on the properties' rising value over time.

A walk down a corridor in East Falls with facility manager Stephen Shinn takes a visitor past the doors of PhillySnaps, an entertainment photographer; the local office of PuroClean disaster remediation, an East Coast chain ready to respond to accidents at any hour; Thirty Three Threads, which makes straps for paintball goggles; and distribution bases for Burnt Mills Cider, Pure Fuel Energy Drink and The Herbal Zen. There's AlumniQ, a software company aimed at higher education events; Petunia Rocks is a gothic fashion merchandiser; and Door Tek, which manufactures and installs windows and doors. Alex's Lemonade, the Main Line-based charity, has a workroom for community fundraisers.

Cofounder and CEO Levi Cohen says they turn down "obnoxiously loud or stinky" businesses that would drive neighbors away.

Motor vehicles including forklifts are forbidden in the neat indoor lanes. WareSpace provides wheeled hand-pumped pallet jacks to move loads between loading dock and six-by-eight-foot doorways to each rental space, plus other simple tools.

Why Philadelphia?

WareSpace also has locations in Maryland, Georgia, Texas, Minnesota and Illinois. Next targets are in the Rocky Mountain states: Phoenix, Salt Lake City and Denver.

"We go in markets that have a high concentration of people," which also means a higher population of veteran and aspiring small-business owners, said Cohen.

The 175,000-square-foot building WareSpace owns, some of which is leased to a gym and other businesses, has factory-quality electrical service capable of delivering more power than the warehouse tenants need, but not enough outdoor pavement to turn a lot of tractor-trailers, as current full-size warehouse users demand.

So it was perfect for conversion into small warehouses, according to Cohen. "That's what we do, we repopulate dated buildings that are challenged" to continue with their previous uses, Ely said. "We've also converted offices and retail" to similar small-warehouse rows.

From WareSpace's perspective, Philadelphia is a good place for the small businesses that are the company's target tenant: Adding taxes, utility, maintenance and other standard costs, total expenses for the basket of services WareSpace offers here are mostly at or below national averages, Cohen says.

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