The buildings are in the Salt River Business Park, at Interstate 65 and Route 480. Construction has begun on the 32-foot clear height, cross-docked distribution facility, and it is expected to be complete by the third quarter.

Steve Hoover, managing director with GE North American Equity, tells GlobeSt.com that the market figures show great promise for the One building. "Bullitt County is becoming the primary submarket for distribution activity in Louisville, with 1.3 million sf of net absorption in 2007 and 1.3 million sf net absorption already in 2008," he says. He says the property will be well-positioned to compete for larger distribution tenants. "At the time of delivery, [the Two building] will be the only available facility able to accommodate tenants with requirements larger than 300,000 sf in the Louisville market," Hoover says.

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

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

He says he cannot divulge the full cost of construction of the Two building. The asking lease rate will be $3.65 per sf, triple net. Lauth has received inquiries from significant users, but has not signed any leases yet. The company just hired Phil Charmoli with Commercial Kentucky Inc. to serve as the agent for the new facility.