GlobeSt.com EXCLUSIVE: Higgins Buys 37 Acres to Add 465,000 SF of New Construction

WEISENBERG TWP., PA-Chicago-based Higgins Development Corp. has added two more parcels, aggregating 36.7 acres, to its holdings in Arcadia West Industrial Park. It plans a 380,000-sf warehouse distribution center on the 25.6-acre parcel and an 85,000-sf flex building on the 11.1-acre site. These will join the 503,000-sf spec distribution center now under construction by Higgins, which is set for completion in March 2006.

Higgins paid Bethlehem-based Arcadia Properties $4.6 million, or about $125,000 an acre, for the land. Jeffrey Garibaldi, president; Gerald Moore, principal, and Michael Bartolacci, VP of Chatham, NJ-based the Garibaldi Group/Corfac International, negotiated the land sale, and Bartolacci and Moore will market the facilities. This is the same team that negotiated Higgins' previous land acquisition here and is handling leasing of the building under construction.

Higgins' SVP Gene Preston, who heads the company's Morristown, NJ office, tells GlobeSt.com that the construction cost, not counting the land, is about $40 per sf. The larger building, he says, will break ground as soon as the 503,000-sf property is leased. While he welcomes build-to-suit interest, "we'll build it on spec," he says. The smaller building is targeted as a build-to-suit and will begin when a client is found.

The asking rental rate for both spec buildings is $4.50 per sf triple-net, Bartolacci tells GlobeSt.com. "The Lehigh Valley market has shown significant growth with market pricing increasing, and spec construction has started again throughout the market."

This acquisition brings Higgins' total development rights in Eastern Pennsylvania to 4.8 million sf in three areas: here in the Lehigh Valley, Harrisburg/Carlisle, and Hazelton. Of the total, three buildings aggregating 1.5 million sf are currently under construction. The 600,000-sf Key Distribution Center in Carlisle and the 400,000-sf Northeast Distribution Center in Hazelton are scheduled for delivery in summer 2006 with rates of $4.25 per sf and $4.15 per sf, respectively. Grubb & Ellis is handling the leasing of those properties.

"We're very bullish on Eastern Pennsylvania," Preston says, pointing to Interstate 81's efficiency in reaching from Boston to Atlanta and into Canada. Because of the transportation network Bartolacci says interest in Higgins' Arcadia properties is coming from both regional and national service sector companies looking to establish hubs here.