MINNEAPOLIS—Scannell Properties has just outlined its short and long term plans for Kinghorn Logistics Hub, including a 220,000-square-foot speculative warehouse distribution facility that it will break ground on this month. The new 67-acre business park in northwest suburban Rogers could eventually have as much as 1.5-million-square-feet, company officials say. The Indianapolis-based Scannell also named JLL's Chris Hickok, executive vice president, and Dan Terry, vice president as exclusive marketing representatives for the spec project and the build-to-suit sites.
The new spec is just one of many now rising in the Twin Cities, one of the economically healthiest regions in the nation. Developers have about 2.5-million-square-feet of industrial spec projects underway, Hickok tells GlobeSt.com, all of it bulk distribution.
The source of developers' confidence is easy to pinpoint, he adds. Although the official vacancy rate in the sector is 9.1%, a significant number of these buildings are functionally obsolete. Furthermore, the unemployment rate is only 4.1%, the lowest in eight years and the lowest of any metro area in the US. About 7,200 jobs were added to the local economy in September, on top of the 8,900 added in August. “There are a lot of manufacturing companies in the Twin Cities that have to distribute their products.”
In addition to the many spec projects, industrial developers also have about 1.5-million-square-feet of build-to-suit buildings underway. In the last two years, Hickok says, developers typically had more build-to-suit space under construction, but “the tide has turned. I think everyone is very bullish about it.”
However, of the spec projects under development, Hickok says “I don't think they are as well located as this site.” In addition to having quick access to I-94, FedEx recently launched a 350,000-square-foot distribution center in the southern portion of the park, projected to open in September, 2015. And as the marketing efforts go forward, JLL expects a lot of interest from “companies that use FedEx quite a bit; we're only 100 yards away from them.”
“The adjacency of the FedEx distribution center clearly differentiates Kinghorn from virtually any other park in the area,” says Tim Elam of Scannell Properties. “FedEx is a proven entity, an organization that has spurred additional development and business activity in virtually every market where a new distribution facility has been constructed.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
