Real Estate Update
Evansville. "There's a lot of excitement about our downtown," says Ken Newcomb, president of EC. Tucker Commercial in Evansville. "Our downtown is on a fast track of rebuilding."
In recent years the skyline has benefited from new headquarters buildings for Vectren and Old National Bancorp. Now, residential opportunities are on the rise, including lofts and condominiums, he says.
Efforts also are under way to boost the downtown's status as a tourism and entertainment destination, reports Jeff Deig, vice president of engineering and business development for Industrial Contractors in Evansville. His company is currently working on new entertainment options linked to Casino Aztar, including a new hotel, a Jillian's entertainment complex and a Ri-Ra Irish pub.
The firm also is playing a role in the engineering and construction of the Hands On Discovery Children's Museum, which is to open next school year in the old, art deco Central Library building downtown. "That's a project with a lot of visibility," Deig says.
The downtown office market remains affected by the move of Vectren and Old National to their new quarters, which left their old spaces vacant. There's still a quarter of a million square feet of space available in the central business district, and the vacancy rate exceeds 20 percent. But, says Newcomb, "we're getting a lot of inquiries about the space there.
The suburban market is a different story, with office vacancy rates in the 12 percent range. New developments include a $40 million project involving locally based Shoe Carnival Inc., which is planning a large, new distribution center on State Road 57 and a new corporate headquarters on the east side of town.
Newcomb says the Evansville area continues to experience a crunch in larger industrial space-those facilities in excess of 100,000 square feet. "Our vacancy rate for big-box space is zero. There is zero supply," he says. Newcomb has talked about the need for speculative industrial space for some time now, noting that some potential users have had to look elsewhere. "People are starting to take notice, but we don't have any on the drawing boards right now."
Medical space continues to grow, led by the January opening of the new Deaconess Gateway Hospital in Newburgh. Built by Industrial Contractors, the facility along Interstate 164 includes 116 beds and multiple buildings totaling about 400,000 square feet.
Fort Wayne. The industrial market in and around Fort Wayne continues to be strong, reports Mike Dahm of NAI Harding Dahm. Numerous companies are expanding, led by the General Motors truck plant, which has been working on a $175 million expansion promising several hundred new jobs. Also sewing up growth plans is Vera Bradley Designs, with a $26 million expansion project.
Music and audio retailer Sweetwater Sound is another local firm growing into new quarters. It's taking over space in the former North American Van Lines facility for a headquarters and national sales operation. About 200 people work for Sweetwater now, and the expansion could add 120 more jobs. Other companies growing their operations, says Dahm, include C&M Fine Pack, Verizon, ITT, Medical Protective Co. and the Fort Wayne newspapers.
The city's downtown office market continues to have significant vacancy, according to Dahm, but vacancies are quite a bit lower in the suburban markets. Meanwhile, the warehouse/manufacturing inventory is tight, he says.
Retailing is mostly strong, Dahm continues, with most construction activity in the Jefferson Pointe and Dupont Coldwater corridors. Fort Wayne's large Glenbrook Mall is likely to see changes,. though, thanks to the closing of anchor Marshall Field. Wal-Mart is in growth mode, Dahm reports, with three supercenters in the works.
Health-care construction is likely to stir continued interest in nearby areas. One recently announced project will add beds and square footage at Parkview North Hospital. North-side neighbor Dupont Hospital also is in the midst of expansion.
Indianapolis. The "Crossroads of America" continues to. be the crossroads of warehousing and distribution. Some 2.7 million square feet of modem bulk space was absorbed in 2005, with quite a bit more to be built in 2006, according to statistics from Colliers Turley Martin Tucker. Deals announced in recent months include facilities for Epson America, Caterpillar Logistics Services and Nice-Pak Products.
Plainfield's spot on the distribution map will be further boosted by the development of the CentraLogistics; Industrial Park. The town, annexed nearly 900 acres to support the project, to be developed by Browning Investments of Indianapolis. It will allow room for some 11 million square feet, of space in several buildings, and will become central Indiana's second-largest industrial park,
Though Plainfield, Brownsburg and Lebanon have been market growth leaders when it comes to distribution, expect to see other parts of the metro area joining in the fun in the coming months and years. Such emerging markets as Greenwood, Whitestown and Mount Comfort hope to generate significant industrial and warehousing growth, according to Colliers Turley Martin Tucker forecasts.
The downtown Indianapolis office market later this year will get a taste of what Evansville has been experiencing. Simon Property Group is making plans to move into its own headquarters tower this year, a move than will open up big chunks of leased space at National City Center, where Simon has maintained its headquarters. In the meantime, though, vacancy rates have been drifting downward, according to Colliers Turley Martin Tucker. Absorption of office space is also solid in the suburban markets, where speculative construction continues.
The big story in retailing continues to be the lifestyle center. Clay Terrace in Carmel led the way in 2004, and the concept has since blossomed in Hendricks County with the opening of Plainfield's Metropolis development, with 850,000 square feet of open-air shopping. Next year will see the opening of another such development, the Hamilton Town Center along Interstate 69.
The same stretch of I-69 is where Republic Development is building its Saxony project. It's a mixeduse project spanning 725 acres, according to Republic president Rick Amos, with uses ranging from retail, office and medical to residential of all kinds. Breaking ground this year will be life-sciences manufacturer Helmer Inc., building a headquarters facility and joining the already open Community Health Pavilion. Other deals are in the works, and a large town home development is already well under way.
Another mixed-use project in. the works is Gramercy, which is to replace the Mohawk Hills golf course and apartment complex in Carmel with office space, hotels, retail operations and a variety of residential. The area's biggest mixed-use development is Anson, a Duke Realty project planned along Interstate 65 to the northwest of Indianapolis.
Northwest Indiana. The northwest comer of the state could become quite the destination for sporting goods and outdoor gear. Two major chains are planning megastores designed to attract shoppers from miles away Cabelas on a site in Hammond and Bass Pro Shops in Portage. Bass Pro recently won state incentives for its project, and Cabela's is seeking state assistance as well.
It's all part of significant retail growth, according to David Lasser, president of Commercial In-Sites in Merrillville. He adds that two Chesterton-area projects are in the works that would total about 700,000 square feet.
Lasser also hails the recent announcement that the Ameriplex at the Crossroads, project will receive the state's Certified Technology Park status. The 386-acre business and technology park in Merrillville is being developed by Purdue University and Holladay Properties, and includes a Purdue-affiliated technology incubator.
As for the office market, inventory is tight, according to Lasser. "The Class A office market is at about 95 percent occupancy right now."
South Bend. Hospital development headlines the real estate news in the South Bend area. St. Joseph Regional Medical Center in December announced plans to build a 633,000-square foot facility on a 90-acre site in Mishawaka's Edison Lakes corporate park. "Some 2,500 people will work there, which bodes well for restaurants and shops and other businesses in the area," notes Chris Davey, president, of Grubb & Ellis/Cressy & Everett.
That project set to open in 2009 is already sparking a lot of interest for nearby development, Davey says. A medical office building is in the works, he says, and the project could help attract another hotel to the area.
Memorial Hospital in South Bend has also been in growth mode, Davey says, and remains an anchor for the downtown area. Other downtown activity includes South Bend Chocolate Co. growth (including a new chocolate cafe within Memorial Hospital), as well as the possibility of new residential development.
The industrial sector has been quiet, Davey says, but it's starting to come to life. "It looks like we might see some speculative development for the first time in four or five years," he says.
The Erskine Village project that replaced the former Scottsdale Mall has breathed new retail life into the southern part of South Bend. "A lot of retail activity is being generated on the south side of town," Davey says.