The presidential election is long over, and the near-term outlook for the nation’s economy doesn’t look quite as uncertain as it might have six months ago.
Meanwhile, the smart commercial real estate money is through sitting on its collective hands and is busy bringing projects out of the ground. Here are a few of the places where you’ll see the action is going to take place in 2013.
3PL Plays in Bryan County
If the past is any predictor of the future, 2013 ought to be a good year for Interstate Centre, an 1,100-acre park being promoted by the Development Authority of Bryan County at the Interstate 16 and U.S. 280 interchange.
A pair of port-driven 3PL (third-party logistics) firms closed the books on 2012 with a flourish. In September, Matson Logistics Inc., the U.S. rail intermodal/highway brokerage/warehousing U.S. unit of Honolulu-based ocean freight carrier Matson Inc. (NYSE: MATX), locked in an expansion at 604,930-square-foot building 100, growing its footprint here from 135,000 to 237,600 square feet over the next five years.
Shortly thereafter, Chattanooga, Tenn.-based 3PL Kenco Logistics Services inked a lease for 230,000 square feet of Building 100 space. According to company officials, Kenco chose this facility, its fourth in Georgia and its first in the Savannah area, primarily because of its proximity to the Port of Savannah, as well as the area’s well-developed infrastructure.
Meanwhile, Belfast Commerce Center, a 904-acre park at Interstate 95 and Belfast Keller Road owned by TerraPointe, the real estate subsidiary of Jacksonville, Fla.-based Rayonier (NYSE: RYN), opened for business. Linked to the port by both interstate highway and rail (CSX Corp. and Riceboro Southern Rail) lines, the 900-acre business park is the largest rail-served site in the Savannah market, according to Josh Fenn, executive director of the Development Authority of Bryan County.
Fenn feels good about prospects for activity in these two parks in the coming year.
“With Belfast [Commerce Center] coming on line, we can offer product in parks on I-16 and I-95, both within 18 miles of the port,” said Fenn. “And although we are basically out of buildings to sell, we do expect that developers will come in and invest in sites as the capital markets improve in 2013.”
While many Savannah-area projects are driven by proximity to the port, others are driven by another major engine of the local economy, i.e., the Savannah College of Art and Design.
SCAD students are the target market for residential units at One West Victory. Located on a long-underutilized, 1.74-acre site bounded by Victory Drive, Bull and Barnard streets, the project entails the redevelopment of two late 19th-century buildings, totaling 124,000 square feet, into 114 LEED-Certified student apartment homes, an on-site restaurant, a study hall, student lounge and a 218-space parking deck.
Watch for One West Victory to begin to take form in late 2013 when site work is slated to begin, according to Michael Phillips, COO of Atlanta-based Jamestown, the developer of the project. Leasing is planned to begin during summer 2014, he reports.
Retail rocks on Pooler Parkway
Out in the ’burbs, meanwhile, the massive retail buildup in Savannah’s fast-growing Pooler submarket stands to continue in 2013, with a number of projects making their ways through the development pipeline.
Retail ground zero here is along Pooler Parkway just west of its junction with I-95. And there’s more on the way, with Brentwood, Tenn.-based GBT Realty Corp. working on putting together a power center on a 23-acre tract it has under contract (as of year-end 2012) at the northwest corner of the parkway’s intersection with Benton Boulevard, just west of existing Home Depot and Walmart stores.
Plans call for approximately 120,000 square feet of in-line stores and around 17,000 square feet of pad-site retailers. Outparcel-wise, a Logan’s Roadhouse restaurant, the second in metro Savannah, has opened, with Olive Garden and McDonald’s reportedly in the wings.
Meanwhile, a spring 2013 construction start is planned for the Outlet Mall of Georgia, a 560,000-square-foot luxury factory outlet center set for a 70-acre tract in the southwest quadrant of the I-95/Pooler Parkway interchange, behind the existing Sam’s Club.
A project of prolific retail developer Ben Carter, whose portfolio includes the 1.8 million-square-foot Mall of Georgia in the exurbs of metro Atlanta, Outlet Mall of Georgia is slated to feature four anchors, a food court, restaurants and various shops. The project also includes several peripheral pad sites for additional retail and hotel development, bringing the project’s total footprint to just over 150 acres.
Pooler’s mix of residential growth and proximity to employment centers makes the community particularly attractive for retail growth, according to Adam Bryant, an adviser with Sperry Van Ness | GASC Commercial.
Pooler is the fastest-growing community in the Savannah area,” Bryant said, “and as its population continues to grow, new retail is following new rooftops.”
Retailing in and around the Pooler Parkway/I-95 interchange is also supported by a daytime population comprised of workers at nearby major employers such as Gulfstream, he said.
Drawing them in
While it didn’t snare a user to accompany Mitsubishi’s Savannah Machinery Works, the 1,500-acre Pooler megasite at I-95 and I-16 did generate a lot of prospect activity in 2012, both for itself and for other metro-area industrial sites.
“The megasite is our No. 1 attraction,” said Brandt Herndon, vice president of Business Development for the Savannah Economic Development Authority (SEDA). “But in some instances, a prospect will come here to look at the site, and realize it’s not the right place for them, which then gives us the opportunity to show them some other sites.”
These other sites include a 30-acre tract owned by SEDA at Crossroads Business Park, where retailer Dollar Tree recently completed a 400,000-square-foot expansion of its existing distribution center; two 60-acre sites at Northport Business Park, a 254-acre park located near the I-95/Ga. 21 interchange; and tracts that can handle buildings up to 1.3 million square feet at Prologis ((NYSE: PLD) Morgan Business Center in Bloomingdale.
The prospect pool for Savannah-area sites of late has been comprised of a 50-50 mix of port-related distribution and traditional manufacturing, Herndon said. He looks for a pickup in overall activity in 2013.
“A lot of people have been sitting on the sidelines waiting to see what happens with the election and the economy,” said Herndon. “We are past the election now, and I think people are now realizing what the next four years are going to look like — and that those who have needed to move forward with projects are beginning to do so.”