MIDLOTHIAN, TX-QuikTrip Corp. has acquired a 316,000-square-foot distribution center that will serve 85 regional stores and an additional 15 that the company plans to open over the next three years.
Tulsa, OK-based QuikTrip bought the facility located at 4200 Railport Pkwy. from Chicago-based Kehe Food Distributors. The sale price was not disclosed, but local experts say the building sold for more than $10 million; those same experts estimate that the initial development costs for the facility exceeded $25 million.
Kehe Food Distributors built the one-story facility three years ago, but never occupied it. Situated on 48.8 acres, the building has 72-foot ceilings, making it one of the tallest single-story buildings in the state. It also features 40,500 square feet of freezer space, another 40,000 square feet of refrigerated space, 3,500 square feet of office space and 38 truck docks.
"After Kehe built the facility, it didn't meet its needs because the company changed from an automated racking system [that requires above average clear height] to a more conventional 30-foot clear height," says Trey Fricke of Lee & Associates' Dallas/Fort Worth office. He and Reid Bassinger, also with Lee & Associates, represented the seller. Jesse Pruitt with Somervell Commercial Realty and Chris Teesdale with Colliers International represented QuikTrip.
Fricke tells GlobeSt. the property was on the market for almost 18 months. “We had a lot of interest, mainly from manufacturers," he says. "We didn't have as much interest as we thought we would from food users."
Teesdale says QuikTrip considered a build-to-suit facility in Burleson, a southern suburb of Fort Worth. “QuikTrip was going to build almost the same building in Burleson, just a little smaller and with lower clear height,” he says. “Once we understood their requirements, the Kehe building was a perfect fit." He adds: "It was much cheaper for QuikTrip to buy than to build. They were able to save a lot of funds by acquiring this facility."
Additionally, the facility offered an ideal location for QuikTrip, Teesdale says. "The location was comparable to what they were considering in Burleson" he notes." Like Burleson, Midlothian is on the southern end of Metroplex, but it is actually even more centrally located."
QuikTrip doesn't plan to move into its new facility until late second or third quarter 2011. In the meantime, the company will retrofit the interior with a high-tech racking system. "Because of the nature of the building, anyone would have to spend $3 million to $7 million to customize it," Fricke says.
The new distribution facility will employ about 50 people. QuikTrip negotiated incentives with both the City of Midlothian and Ellis County.
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