E-Commerce Growth Places Premium on Densely Populated Infill

DALLAS—E-commerce sales, an already strong and growing demand driver for industrial distribution space, have spiked during the pandemic and are estimated to grow by 18% this year, the highest year- over-year increase on record according to eMarketer. The COVID-19 pandemic and the shelter-in-place policies that ensued have accelerated e-commerce growth and the need for warehouse space across the nation. JLL expects e-commerce sales could hit $1.5 trillion by 2025, which would increase the demand for industrial real estate to an additional 1 billion square feet.

This growth is placing a premium on infill sites within densely populated areas. One recent example is CT Realty’s acquisition of a 18.46-acre infill location. The site will be home to Stadium Logistics Center, a 329,402-square-foot industrial building which is planned for completion in September 2021.

The $40 million project will meet the surging demand for supply chain distribution space amid spiking e-commerce sales growth. The development represents CT’s longstanding national industrial logistics investment and development strategy, including an emphasis in the DFW metroplex.

“CT made an enormous commitment to the greater DFW market almost 10 years ago and we couldn’t be more pleased with our positioning in one of the largest industrial/logistics markets in the US with over 850 million square feet of standing inventory,” said Rob Huthnance, the CT partner responsible for Midwest and East Coast development and operations. “This is an outstanding property next to the former storied Texas Stadium and fronting Highway 183 with a 6-mile run to downtown Dallas. This is an incredible last mile location that is strategically centered in the DFW metroplex.”

The site offers 470 feet of frontage on Highway 183 immediately west of the Interstate 35 Stemmons Freeway in the established South Stemmons industrial submarket, where current vacancy is below 4% against an inventory of 120 million square feet. Dallas Love Field Airport is 5 miles to the east and DFW International Airport is located 7.5 miles west.

Stadium Logistics Center features 36-foot clear height and a front park/rear load configuration that is ideal for goods distribution and in high demand by supply chain users.

CT purchased the site from long-term owner NCH Corporation which was represented in the transaction by Mike McElwee at Avison Young. JLL’s Craig Jones and Randy Touchstone represented CT and will handle leasing of the project.

This spec project will most likely lease to any number of companies in the logistical supply chain, with a likely nod toward users with heavy e-commerce business. Activity in the DFW metroplex has been robust for the last few years across a wide array of users, according to insight from CT’s spokesperson.

JLL research indicates that Dallas-Fort Worth continues to be one of the most active industrial markets in the country. Demand has been keeping up with new supply, with 13.4 million square feet of net absorption and 16.2 million square feet of space delivered through the first half of 2020. Vacancy rates are even with the 10-year average of 7.5%, while leading the country in construction activity.

In second quarter 2020, 22.6 million square feet of space was under construction, with nearly 40% located in the North Fort Worth submarket alone. More than 20 million square feet have been constructed each quarter since first quarter 2016.

The general contractor of Stadium Logistics Center is Talley Riggins Construction Group and the project is being designed by Pross Design Group, both based in the Dallas area. Construction financing will be provided by California Bank and Trust.

CT recently sold two buildings totaling 880,000 square feet in Fort Worth and just broke ground on 1.2 million square feet in two industrial buildings in Columbus, OH. The company also has significant developments underway in California, where CT has just purchased 310 acres in the Inland Empire and acquired another 160 acres next to an existing CT project in Stockton. CT has additional developments underway in New Jersey, Indianapolis and Atlanta.