The buildings are in the Salt River Business Park, at Interstate65 and Route 480. Construction has begun on the 32-foot clearheight, cross-docked distribution facility, and it is expected tobe complete by the third quarter.

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Steve Hoover, managing director with GE North American Equity,tells GlobeSt.com that the market figures show great promise forthe One building. "Bullitt County is becoming the primary submarketfor distribution activity in Louisville, with 1.3 million sf of netabsorption in 2007 and 1.3 million sf net absorption already in2008," he says. He says the property will be well-positioned tocompete for larger distribution tenants. "At the time of delivery,[the Two building] will be the only available facility able toaccommodate tenants with requirements larger than 300,000 sf in theLouisville market," Hoover says.

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GE has built a similar relationship with Lauth in other markets,closing ventures for distribution buildings in Denver andIndianapolis. Michael Garvey, SVP with Lauth, said in a statementthat GE's money infusion helped Lauth begin work on Two immediatelyto take advantage of favorable market timing and to lock downconstruction pricing. "We…are considering expanding thisrelationship to include additional distribution parks as well asother asset types," he said in the statement.

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Salt River One, an 832,000-sf building, was sold by Lauth a yearago to USAA Real Estate for $38.8 million, and is mostly leased toZappos.com, a distributor of shoes and handbags. "It was a build tosuit for them," says Tag Birge, Midwest regional director withLauth. The property is 80% leased, with about 208,000 sf vacant.Birge tells GlobeSt.com that the success of the One building wasone of the reasons that led to the spec property. "We think themarket has had really good net absorption. You've got UPS spending$1 billion to expand its Worldport facility, and we're right off ofI-65, which is a major logistics corridor for north-south traffic.We thought it was a good time to make another investment."

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He says he cannot divulge the full cost of construction of theTwo building. The asking lease rate will be $3.65 per sf, triplenet. Lauth has received inquiries from significant users, but hasnot signed any leases yet. The company just hired Phil Charmoliwith Commercial Kentucky Inc. to serve as the agent for the newfacility.

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