Can Industrial Demand be Satisfied with Spec?

LANCASTER, TX—The Dallas-Fort Worth-Arlington economy continues to report brisk demand, as increases in total population and overall employment are the norm. According to Moody's Analytics, population increased by 142,000 year-over-year, totaling 7.3 million people at the end of first quarter 2017. This equates to an average of 395 new residents each day.

During the same time period, the employment base increased by 125,000, dropping the unemployment rate by 10 basis points and closing the first quarter of 2017 at 3.8%. Out of the 125,000 jobs added, 31% or 39,000 jobs can be attributed to the industrial sector, which is comprised of goods producing and trade, transportation and utilities. This category accounts for 62% of the entire industrial sector and is the leading indicator for industrial space demand.

In response to the booming industrial demand, Crow Holdings Capital-Real Estate is developing a two-building industrial park strategically located at the southwest intersection of Interstate 35 and Interstate 20. I-35 Logistics Crossing will feature twin 610,806-square-foot cross dock facilities at the northwest corner of Houston School and Wintergreen roads.

“Crow Holdings is very bullish on the DFW market, especially Dallas' southern sector because of strong industrial absorption levels in the region reinforced by continued population growth,” said Ben Doherty, head of industrial and self-storage investment strategies for Crow Holdings Capital-Real Estate. “We were pleased with the results of our Mountain Creek project, also located in south Dallas, and welcome the opportunity to continue developing in the market. We believe our building sizes will serve the market well because other new developments have focused on different-sized products. That's why we are moving forward on a speculative basis and developing both buildings at the same time.”

Kurt Griffin and Nathan Orbin, executive managing directors with Cushman & Wakefield, have been selected to oversee leasing.

“The new buildings will offer unparalleled access to Interstates 35 and 20 and feature state-of-the-art amenities, including 36-foot clear heights, 185-foot truck courts and abundant trailer storage, which can be fenced and secured,” Griffin says. “I-35 Logistics Crossing will provide users direct access to the DFW region, as well as other major Texas markets such as Austin and San Antonio. The city of Lancaster is a great place to do business and has a history of supporting industrial tenants through economic incentives, including property tax abatements. That will help make I-35 Logistics Crossing very competitive from an occupancy cost standpoint.”

According to Cushman & Wakefield research, tenants absorbed nearly 5.4 million square feet of DFW industrial space during the first quarter of 2017, with more than 1.5 million square feet occurring in the southern sector.

“South Dallas, specifically, is seeing good demand for deals sized 600,000 square feet and above,” Orbin said. “Overall, we're tracking 25 million square feet of active tenants in the DFW market and South Dallas is among the most desirable submarkets.”

Construction of I-35 Logistics Crossing is expected to begin this month, with completion scheduled for the first quarter of 2018.

“This project has great access off I-35 and I-20, is centrally located in South Dallas with close proximity to the UP Intermodal and FedEx ground facilities,” Orbin tells GlobeSt.com. “We are excited to partner with a fantastic developer in Crow Holdings on this class-A industrial park.”

The location provides a desirable business park environment for the South Dallas submarket, which is already home to major corporate tenants such as BMW, Mars Petcare and NFI.

“With its access to a large freeway infrastructure, the park will provide a logistics advantage to tenants,” Griffin tells GlobeSt.com. “We anticipate tenants with heavy distribution and warehouse requirements but it could lend itself to manufacturing or e-commerce tenants as well.”

LANCASTER, TX—The Dallas-Fort Worth-Arlington economy continues to report brisk demand, as increases in total population and overall employment are the norm. According to Moody's Analytics, population increased by 142,000 year-over-year, totaling 7.3 million people at the end of first quarter 2017. This equates to an average of 395 new residents each day.

During the same time period, the employment base increased by 125,000, dropping the unemployment rate by 10 basis points and closing the first quarter of 2017 at 3.8%. Out of the 125,000 jobs added, 31% or 39,000 jobs can be attributed to the industrial sector, which is comprised of goods producing and trade, transportation and utilities. This category accounts for 62% of the entire industrial sector and is the leading indicator for industrial space demand.

In response to the booming industrial demand, Crow Holdings Capital-Real Estate is developing a two-building industrial park strategically located at the southwest intersection of Interstate 35 and Interstate 20. I-35 Logistics Crossing will feature twin 610,806-square-foot cross dock facilities at the northwest corner of Houston School and Wintergreen roads.

“Crow Holdings is very bullish on the DFW market, especially Dallas' southern sector because of strong industrial absorption levels in the region reinforced by continued population growth,” said Ben Doherty, head of industrial and self-storage investment strategies for Crow Holdings Capital-Real Estate. “We were pleased with the results of our Mountain Creek project, also located in south Dallas, and welcome the opportunity to continue developing in the market. We believe our building sizes will serve the market well because other new developments have focused on different-sized products. That's why we are moving forward on a speculative basis and developing both buildings at the same time.”

Kurt Griffin and Nathan Orbin, executive managing directors with Cushman & Wakefield, have been selected to oversee leasing.

“The new buildings will offer unparalleled access to Interstates 35 and 20 and feature state-of-the-art amenities, including 36-foot clear heights, 185-foot truck courts and abundant trailer storage, which can be fenced and secured,” Griffin says. “I-35 Logistics Crossing will provide users direct access to the DFW region, as well as other major Texas markets such as Austin and San Antonio. The city of Lancaster is a great place to do business and has a history of supporting industrial tenants through economic incentives, including property tax abatements. That will help make I-35 Logistics Crossing very competitive from an occupancy cost standpoint.”

According to Cushman & Wakefield research, tenants absorbed nearly 5.4 million square feet of DFW industrial space during the first quarter of 2017, with more than 1.5 million square feet occurring in the southern sector.

“South Dallas, specifically, is seeing good demand for deals sized 600,000 square feet and above,” Orbin said. “Overall, we're tracking 25 million square feet of active tenants in the DFW market and South Dallas is among the most desirable submarkets.”

Construction of I-35 Logistics Crossing is expected to begin this month, with completion scheduled for the first quarter of 2018.

“This project has great access off I-35 and I-20, is centrally located in South Dallas with close proximity to the UP Intermodal and FedEx ground facilities,” Orbin tells GlobeSt.com. “We are excited to partner with a fantastic developer in Crow Holdings on this class-A industrial park.”

The location provides a desirable business park environment for the South Dallas submarket, which is already home to major corporate tenants such as BMW, Mars Petcare and NFI.

“With its access to a large freeway infrastructure, the park will provide a logistics advantage to tenants,” Griffin tells GlobeSt.com. “We anticipate tenants with heavy distribution and warehouse requirements but it could lend itself to manufacturing or e-commerce tenants as well.”