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HACKENSACK, NJ-Millions of sf of new industrial product will be hitting the New Jersey market soon. Two of the biggest industrial holders, ProLogis and Panattoni Development, each have multiple projects in the works for New Jersey. Representatives from both companies spoke about these projects at a dinner for the Industrial and Office Real Estate Brokers Organization held here this week.
George Hasenecz, vice president at ProLogis, said that three large projects were under way in the industrial corridors. The Elizabeth Seaport will have one million sf across three buildings. The Port Redding Business Park in Wood-Ridge will have 3.3 million sf across nine properties. Both are brownfield redevelopments, with Elizabeth's remediation costing $20 million and Port Redding's costing $10 million.
Hasenecz wouldn't speculate the exact rate these buildings would go for once completed but said "it's probably going to be pretty significant."
He said clients are still willing to buy shell buildings for $65 to $70 per sf, despite "a pretty significant increase in construction costs." ProLogis is also expanding its Station Road project in Cranbury, adding two more buildings of 600,000 sf and 210,000 sf.
James Murray, partner at Sacramento-based Panattoni Development, is working on two major industrial projects in New Jersey, iPort 12 and iPort 440.iPort 12, which started construction in October on a brownfields site, is currently underway. The complex is split between a larger 1,064,515-sf shell building and a smaller 200,218-sf shell building. Last month CB Richard Ellis was named exclusive leasing agent for iPort 12, as reported by GlobeSt.com.
iPort 440, Panattoni's two-million-sf complex being planned in Perth Amboy, should be ready to start construction in "a little less than a year from now," Murray said.Building such big projects in New Jersey is challenging, especially negotiating with municipalities. "Some towns are better than others. Some people get in trouble overselling. You have to manage expectations," Murray said. "You need a lot of staying power to make it through."
Despite remediation hurdles and costs, brownfield parcels shouldn't be written off, Murray said. "There's value in those sites, especially in New Jersey. But you have to be careful about it. At the end of the day, you go into the DEP and say 'Development and remediation.' That's the way it is."
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