JACKSONVILLE, FL-Arts and crafts specialty retailer Michaels Stores Inc. has signed a 270,000-square-foot lease agreement to occupy a building at 4300 Bulls Bay Highway inside the Westside Industrial Park. Terms of lease were not disclosed. The facility was originally built in 1991 for luggage giant Samsonite Corp., which is relocating to a new 800,000-square-foot, $35 million distribution center at Imeson International Industrial Park.

Michaels will use the space as a seasonal goods distribution center and plans to occupy the building this summer, according to CB Richard Ellis, which represented the tenant in the transaction. The company currently owns and operates over 1,000 Michaels stores throughout North America, along with 161 Aaron Bros. stores. The tenant's new location is owned by its original developer, Stone Mountain Industrial Park Inc., an affiliate of Atlanta-based Pattillo.

"Just as Samsonite is moving out after 15 years, Michaels is moving in," Pattillo CEO Larry Callahan tells GlobeSt.com, adding that renovations are under way at the building. A new roof has just been completed and the company is converting the building to accommodate the new tenant by installing truck bays on both sides of the facility.

Pattillo is the developer and owner of the 6-million-square-foot Westside Industrial Park, which is two-thirds built out, according to Callahan. The company is the largest privately held industrial operation based in the Southeast, and currently owns 20 million square feet of industrial buildings in the region.

"Our main focus during the downturn is going to be to keep those buildings as full as possible," says Callahan. "We stand ready to build at all times, but we fully expect to see a slow market. The US economy tends to expand and developers start broadly building a lot of new inventory when the factory capacity utilization hits 80% to 82%, and right now we're at 68%."