Tampa/Hillsborough commercial real estate roundup
October 8, 2015
As we begin the fourth quarter of 2015, strong demand continues to drive leasing and sales activity in Tampa’s industrial market. Three lease transactions by companies taking 100,000 square feet or greater have closed recently in the East Tampa submarket, keeping available inventories tight, especially for Class A industrial users. E-commerce, logistics and manufacturing firms are among the most active in pursuing space in the local market.
Industrial developers in Tampa have responded at a measured pace to keep new industrial product in the pipeline. EastGroup Properties recently delivered two Class A distribution buildings at Madison Distribution Center totaling 127,000 square feet with about 25 percent currently leased. At County Line Commerce Center in Plant City, Central Florida Development (CFD) has just completed its first 100,000-square foot speculative building with about 75 percent of its space under lease. In October, CFD is scheduled to break ground on another speculative 100,000-square foot distribution facility at the same park with delivery scheduled for the first quarter of next year.
Investment demand has heated up in the Tampa Bay area with several large industrial portfolios changing hands. In August, Tampa Distribution Center, a 955,000-square foot industrial campus, was purchased by Boston-based High Street Realty. Cushman & Wakefield reported that this sale was the largest single-site industrial transaction by square footage in the Tampa market since January 2010.
A new cold storage facility being planned by Port Tampa Bay is expected to provide a major boost to fresh and frozen commodities moving through the region and stimulate new demand for supply chain industries. In August, the Board of Commissioners of Port Tampa Bay unanimously approved entering into a 27-year lease with Port Logistics Tampa Bay to develop a new 130,000 square foot state-of-the-art on-dock cold storage facility. The facility will be located in close proximity to the Port’s expanded container berth and its new gantry cranes which will be arriving early next year. The new $19.1 million facility will receive, label, package and distribute a variety of products, including perishable goods, fruits, vegetables, pharmaceuticals and other products that require refrigeration.
Kenco, a national logistics solutions provider, recently ranked the Tampa metro area among the top ten cities in the United States for a distribution center. Its proximity and access to both the Caribbean and the Atlantic, as well as the Southern region, was one of the factors cited.
With the increased industrial demand for specialized space and higher efficiencies, build-to-suit activity is projected to gain increased momentum going into next year. Hillsborough County and its municipalities are well positioned with a variety of entitled land sites to accommodate a wide-range of build-to-suit requirements, up to one million square feet in size.