The Alter Group announced plans to develop a speculative 605,700 SF cross-dock warehouse/distribution center valued at more than $36M at its 162-acre Buckeye Logistics Center at Buckeye Rd. and 67th Ave. in Phoenix, said Michael J. Alter, President of the Chicago-based national commercial real estate development firm.
Groundbreaking is expected to take place in October.
According to Patrick E. Gallagher, Senior Vice President, “The Alter Group is presently talking to several capital partners to finalize the underwriting for this bulk distribution building. . There are only a couple of large warehouse/distribution buildings still available in this segment of the market; vacancy rates for spaces above 500,000 SF, particularly in the Southwest submarket where Buckeye is located, are currently in the low single digits.
“The West Valley has become one of the top areas in the southwest part of the United States for the development of large warehouse facilities to store, package and ship consumer goods ordered via the Internet. The southwest Phoenix market recorded 3.7 million SF of net absorption over the last four quarters of 2011.
Absorption was lower in 1Q 2012 but activity is strong. This steadily increasing user demand, combined with a lack of construction, has vacancy rates continuing to fall. With very few larger buildings available, rents are projected to increase by 20% by 2Q 2013 for large blocks of space.”
The new building will feature 32’ clear ceiling height; 112 dock high and four drive-up level doors; as well as parking for 324 cars and 173 trailers.
Buckeye Logistics Center is strategically located 1.2 miles from I-10 via two full interchanges at 67th Ave. and 75th Ave. The site, ideally suited for regional distribution, also has good access to I-10, which is important for receiving and sending shipments to Southern California markets and ports. Buckeye Logistics Center can support up to 3.1 MSF of distribution space. Three distribution buildings totaling 1.7 MSF have already been built at Buckeye Logistics. Phase I and II were awarded the NAIOP Industrial Project of the Year in 2007 and 2008. Current tenants in the earlier phases are Amazon.com, which occupies more than 1 MSF, and Kellogg’s.