CHARLOTTE-By pushing the go button, Childress Klein Properties is bucking a sluggish six-month trend in speculative development by breaking ground on a $10 million, 250,000-sf warehouse and distribution project at Northpark Business Park in north Charlotte.

The Charlotte-based developer plans two buildings of 130,000 sf and 120,000 sf respectively at the 200-acre, two million-sf park. Completion is scheduled by Jan. 1. The rising vacancy level isn’t deterring Childress Kelin which has built about 800,000 sf in this market over the last several years and seen particularly strong absorption in the last three years.

The vacancy rate from the first to the second quarter rose from 8.9% to 10.4%. Second-quarter absorption was only 75,857 sf, compared with 328,516 sf in the comparable 1999 period, according to Karnes Research Co.

Childress Klein partner Landon Wyatt is confident the spec asset will succeed financially because the company isn’t relying on short-term interest rates to fund the project. The developer has locked in long-term money at a 5.8% interest rate versus conventional 9.5% financing currently being offered by lenders.

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