DALLAS-Denver, Austin, California and the Baltimore-Washington, D.C. area are hot on Insignia Commercial Investments Group's development list, says Barry Nelson, new ICIG president.

Since 1996, Nelson has been the executive managing director for Dallas-based ICIG, a co-investment development subsidiary of Insignia Financial Group Inc., based in New York City. As president, he will be leading a charge to refocus Insignia's development activities strictly on office and industrial projects in the coming year. “Another change is we will broaden the national scope,” he says, adding Insignia's national office network will provide the platform needed to expand development activities in 2001.

“Everything we're looking at is in a very strong location, a very strong market,” Nelson told GlobeSt.com. ICIG will maintain the 1 million sf of new construction that it has been undertaking per year.

Part of the 2001 strategy is to buy acreage for the future in some markets, such as Dallas-Ft. Worth. Talks are under way for a “high-profile piece of property” along the Dallas Tollroad that will become part of a land bank as ICIG awaits a turn-around in investors' perceptions about this market. “Obviously, we're not going to start right away, but we'll be in a position when the market changes,” he says.

The DFW region is in a Catch-22 with its past in that today's investors are wary of the market despite record absorption and strong leasing activity in the past year. “If you're a seller of projects, this market is not good,” he explained to GlobeSt.com. “The perception is the market is overbuilt. It's a hangover from a previous market and it's unfortunate. … Dallas has been good to us. It's just a question of starting something in this particular investment climate.”

Talks also are under way for land in northwest Austin, where breaking ground is in ICIG's 2001 plans. Nelson says ICIG is looking to develop a large suburban, multi-phase office project.

Denver too makes the ICIG 2001 roster, where the developer is getting ready to bring to market a 260,000-sf office project in the southeastern Denver Tech Center submarket and making plans to start a 200,000-sf adjacent office building in third quarter 2001. An anchor tenant for the first phase is expected to be in hand no later than February, says Nelson, putting the spec project at the halfway mark for occupancy.

ICIG has two spec projects, totaling about 800,000 sf, under construction in Portland, OR. In August, ICIG had broken ground on the Sun Tech Corporate Park, a 300,000-sf, four-building office flex project followed by an October groundbreaking on an 11-story, 225,000-sf office tower in the Portland CBD's Lloyd District. ICIG has signed Sun Microsoft Systems to 90,000 sf as an anchor, with two of the suburban park buildings already are fully pre-leased. The projects will be completed in 2001.

ICIG also has its sights set on additional projects in California. Current projects are a 50,000-sf building in San Jose and 400,000-sf industrial development in Fullerton, a Los Angeles suburb.

ICIG's 2001 pipeline won't falter despite predicted economic slowdowns by market-watchers, emphasizes Nelson. That's because, he says, ICIG has selected cities with strong markets historically. A need may arise to require some pre-leasing instead of the spec projects now being built, he says, but only in those markets where it's not a stickling point with prospective tenants. Carryover fears from the Savings and Loan debacle make pre-leasing nearly impossible in Denver and Texas, he says. “They want to see something coming out of the ground,” he explains.

During his tenure with ICIG, Nelson has been instrumental in forging expansion nationwide. He has directed development of more than three million sf of office and industrial properties in Dallas, Portland, Denver, Fullerton and the Silicon Valley. Nelson became part of the ICIG team when it acquired the Paragon Group, where he had overseen that firm's commercial development activities.

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Insignia Commercial's New President Defines 2001 Development Hotspots

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