COVER STORY, JUNE 2005

BUILDING FOR BIG BUSINESS
Heartland Real Estate Business looks at several major business parks underway.
Lindsey Walker

As the industrial hub of the United States, the Midwest must continually develop more and more space to accommodate the influx of manufacturing and distribution users locating to the region. Offering great location, access and incentives, these business parks are attracting tenants — and jobs — to the market.

HUDSON DRIVE BUSINESS CAMPUS
Stow, Ohio

Taking advantage of the historically strong industrial location, Albrecht, Incorporated of Akron, Ohio is developing a new business park in Stow, Ohio just north of Akron. Situated on the former Goodyear mold plant property the company acquired a few months ago, the Hudson Drive Business Campus will feature industrial, warehouse and flex-office space on 106 acres.

Because the development is still in planning stages, the exact make-up of the campus has not yet been determined. “It will be driven largely by the kind of user that goes in,” says Joseph Parsons, president of Albrecht Inc. However, the company’s current plans are to develop 15 buildings totaling approximately 1 million square feet during the next 10 years.

The first phase will include leasing up the existing 131,500-square-foot building formerly occupied by Goodyear. Phase II will feature build-to-suit proposals, which are already being requested.  “Our timing is immediate,” Parsons says. “Leasing up the initial building, we think, will be complete in several months.”

The park will accommodate both speculative and build-to-suit development. “Our plan is for the flex warehouse buildings to be spec,” says Jack Juron, vice president of operations for Albrecht. “The big box will probably start build-to-suits and the second phase of that will be some spec buildings.”

Albrecht’s new park will provide its tenants with many advantages, namely its excellent location. Bounded by Hudson Drive and McCauley Road, the site benefits from access to several major highways, including Interstate 80, Interstate 77 and Interstate 71. It is also nearby the existing Steels Corners Road and the planned Season’s Road interchange that will provide the property with easy accessibility to interchanges onto Route 8. “This will create an interchange to interchange industrial area,” says Jack Juron, vice president of operations for Albrecht. In addition, the rail spur that runs directly through the property may be reactivated within the next few months, according to Juron, which will offer tenants an additional transportation option.

Another perk the campus boasts is its tax incentives. “Our tax incentives are plentiful, including enterprise zone, community reinvestment act area and inclusion in Foreign Trade Zone #181,” Juron says. “That’s particularly exciting.”

With all of the other available industrial land in Stow having already been developed, Albrecht expects its site to fulfill the area’s need for first class space. “We do believe that there is a significant need for first class space in the Stow market,” Parsons says. “Much of the inventory in Stow is older, smaller properties built specifically for machine shops and similar users. There aren’t modern distribution or manufacturing facilities available.”

Albrecht has high hopes for the park, which has already garnered a lot of interest in its early stages. “We envision a well-thought out business campus,” Parsons says. “We are looking for businesses that are image conscious and want to participate in a first class business park.”

NORTHPARK
St. Louis

This summer, NorthPark Partners — an alliance of McEagle, Tristar Business Communities and Clayco — will begin redeveloping 600 acres of land east of the Lambert-St. Louis International Airport in St. Louis into a $400 million mixed-use development. NorthPark, as the project has been dubbed, will feature more than 5 million square feet of office, retail and industrial space, as well as a hotel, when it is complete in an estimated 15 years.

“The ability to assemble 600 acres of land in a central or infill location in a densely developed market like St. Louis is very unusual,” says Larry Chapman, development director with NorthPark Partners. “Because of its size, [NorthPark] offers the opportunity to create a self-contained first class business environment as compared to one-off development, such as a new building here or a new building there next to neighbors you can’t control. This will allow NorthPark to create the business environment that will attract the best quality businesses in a quality business park that will maintain long-term value.”

Besides the centralized location, NorthPark offers excellent access to highways, public transportation and the airport. Situated at the intersection of Interstate 70 and Interstate 170, the park has additional access to two interchanges and four alternate routes to other interstates, as well as two Metro Link stations. “I can’t think of another business park in our metropolitan area that will be directly served by Metro Link,” Chapman says. “And, with Lambert Airport a stone’s throw away from the development, NorthPark will ultimately be the most connected business park in St. Louis.”

With its location and superior access, NorthPark will be able to attract a variety of tenants, including office, commercial, high-tech, warehouse and light industrial users. “NorthPark will break down the barriers to entry and make the decision to locate there simple and safe,” Chapman says. 

As the office and industrial markets improves in the St. Louis market, Chapman believes that the business climate is right for a development of this scope at this time. “What makes conditions favorable for commencing development now is the lack of large blocks of modern office and industrial space that are immediately available,” he says. “NorthPark couldn’t be poised better for a delivery time in what I am confident is an improving market.”

LOGISTICENTER AT SAUK VILLAGE
Sauk Village, Illinois

Reno, Nevada-based DP Partners is turning 350 acres of land in Sauk Village, Illinois, into a master-planned business park that is expected to add 5 million square feet of industrial space to the marketplace. The $150 million LogistiCenter at Sauk Village, which will feature high-cube distribution facilities ranging in size from 50,000 square feet to 1 million square feet, is located approximately 20 miles south of Chicago.

DP Partners is currently building the first facility in LogistiCenter at Sauk Village in Sauk Village, Illinois.

Because the site is rail-served, the company expects the majority of its tenants to be manufacturing and distribution users, specifically those in the steel industry. “The distribution companies bringing in products from overseas and then distributing from the Midwest are our number-one target,” Paris says. “This location is in the heart of the southern Cook County steel and manufacturing world.”

DP Partners plans for most of its buildings to be speculative with a mix of build-to-suits. The company broke ground for the park’s first speculative distribution center in March. The 412,615-square-foot facility is scheduled for completion by the end of August.

Palatine, Illinois-based Harris Architects is providing architectural services; Deerfield, Illinois-based KCC Group Design + Build is the construction manager.

AIRTECH PARK & NORTH AIRTECH PARK
Plainfield, Indiana

Under development since 1999, Airtech Park currently comprises four 800,000-square-foot buildings and a 500,000-square-foot building. The developer, a joint venture partnership between Browning Investments and ProLogis, is nearing completion of a sixth building known as 281 Airtech Parkway, which is an 812,000-square-foot speculative building.

Located near the Indianapolis International Airport and Interstate 70 in Plainfield, Indiana, the 500-acre industrial park targets regional and national distribution operations. Its current tenants include JC Penney, Electrolux, Quaker and Belkin.

Taking advantage of the Plainfield submarket, which has emerged during the past 10 years to now offer approximately 18 million square feet of primarily bulk distribution space, the developers are planning an adjacent 1,100-acre park called North Airtech Park. They will begin closing on the land at the end of this year.

Located just north of the present Airtech Park along the Ronald Reagan Parkway that is currently under construction, North Airtech Park will feature 15 million square feet of new industrial space. “The unique thing about this park is that it will really be an extension of the Plainfield submarket,” says Tom Theobald, vice president of industrial development and leasing with Browning. “The added benefits the users will have with this park is a CSX intermodal facility immediately adjacent to it on the north end of the park.”

The park’s first building is scheduled for delivery in 2007.

GRIMES BUSINESS PARK
Grimes, Iowa

Hubbell Realty Company’s newest business park is located south of Grimes at the intersection of Highway 141 and South 11th Street. The 65-acre Grimes Business Park, which is being developed in two phases, will fill the need for office/warehouse space in the northwest region of Des Moines, Iowa.

“It’s really the sector of Des Moines that’s grown the most and it continues to grow,” says Kevin Sullivan, Vice President of CB Richard Ellis/Hubbell Commercial. “It’s where businesses want to locate in the Greater Des Moines area.”

Driven by current and anticipated market demand, the park will open up additional ground in the market for lots for sale or build-to-suit opportunities. Phase I is a 35-acre parcel, and was completed this spring. A 7,000-square-foot build-to-suit for Central Iowa Regional Housing Authority, the park’s first build-to-suit is underway, will be complete this fall.  Additional build-to-suit proposals are out as well. Phase II includes the development of the remaining 30 acres.

“What makes the park unique is its outstanding visibility on Highway 141, which has high traffic — probably close to 30,000 cars a day and growing rapidly,” says Sullivan. “Industrial tax abatement is also a big attraction.”

Partnering with the city of Grimes, the company was able to secure a “RISE” grant from the state of Iowa. This grant allowed Hubbell to put in a lot of the infrastructure to complete the park. “The city was interested in seeing this happen because they wanted to achieve a new entrance into the southern part of Grimes,” says Steve Niebuhr, Senior Vice President of Hubbell Realty Company. “Before, the city had only one real entrance into the city off of Highway 141. But, they envisioned the benefits of another major access point and they saw this as an opportunity to make that happen.”

NILES INDUSTRIAL CENTER
Niles, Illinois

In Niles, Illinois, The Missner Group is developing a new two-building industrial center totaling 400,000 square feet. With access to Interstate 94, Interstate 90 and Interstate 294, the Niles Industrial Center is centrally located on an approximately 22-acre site on Howard Street and is ideal for small- to medium-sized warehouse, light manufacturing and distribution users.

The Missner Group is developing the Niles Industrial Center in Niles, Illinois.

The development, which is owned through a partnership between The Missner Group and Principal Financial, will be the largest and most technologically advanced in the city of Niles, according to Glen Missner, principal with the firm. “It offers high-end technology that doesn’t exist in this location,” he says.

However, with the advanced technology comes more expensive prices. “It’s an expensive alternative for a lot of people in this market,” says Barry Missner. “But, it’s the most efficient. No real estate in the region has some of the efficiency elements that this center has. I think ultimately people will realize that they’re not paying a huge premium to be in this building and that they’re going to operate more efficiently.”

“The marketplace just needs to get acclimated to this new frontier of rent,” Glen Missner says. “I think we’re in an explosive rental market.”

Palatine, Illinois-based Harris Architect is serving as project architect.



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