Salt Lake City on the Brink of a ‘Robust Emergence’

The Salt Lake City market is on the verge of a boom, and capital is hearing the call. LPC Desert West has entered the market with its first acquisition, but it plans to grow a portfolio in the state. The industrial firm purchased Access Park, a three-building, class-A industrial property in Kaysville, a suburb outside of Salt Lake City. The property totals nearly 213,000 square feet, and it is fully occupied.

“Salt Lake City is on the front side of a very robust emergence,” David Krumwiede, EVP of LPC Desert West, tells GlobeSt.com. “The demographics related to availability of land, cost of doing business and Utah’s absolutely stellar workforce is generating commitments from big companies and investors. This is adding diversity to the market, which will attract even more interest. Utah is in our Desert West region that also includes Arizona, Nevada and New Mexico, and adding assets here creates nice geographic diversity for our portfolio.”

The firm plans to follow a similar acquisition strategy as it has in other Western US secondary growth markets, like Phoenix. “Our job as an investor and a developer is to anticipate a market’s evolution and that is how we are approaching our expansion in Utah—identifying the best opportunities for growth in the state’s office and industrial markets,” says Krumwiede. “We earmarked 2020 as our year to geographically expand into the Desert West region and we’re excited and ready for that diversification. We entered the Nevada market in May and Utah in September.”

Access Park was a perfect fit for this strategy. It is in a submarket with pent-up demand and a low overall vacancy rate of 1.5%. In addition, the area has a strong labor pool. Shortly after the premier acquisition, LPC Desert West also acquired Pacific Landing. “Pacific Landing adds a good balance to that with an address in Salt Lake City’s northwest quadrant, part of the city’s industrial core. This area is experiencing very large, credit tenant commitments and is the site of a massive proposed inland port that could significantly advance the submarket with new infrastructure and utilities,” says Krumwiede. “Both Access Park and Pacific Landing include a mix of stabilized and new industrial buildings with great tenancy and the modern features that you need to attract and retain class-A businesses.”

LPC Desert West has grown substantially in the last few years, and it plans to do the same in Utah. “We want to grow into Utah as we’ve done in Phoenix,” says Krumwiede. “We’ve already acquired our first two industrial projects in the state and industrial development is also definitely on the table. Industrial delivers great current returns and tremendous long-term potential as well, so we’re actively evaluating land sites for construction and would quickly act on those in the right scenario.”