Strong performance of the Puget Sound real estate market continues late into the year, this time with another industrial site in Tacoma selling and readying for a massive redevelopment, which when completed will deliver 1.2 million square feet of office/warehouse and industrial space along with 720 parking spots on a 52.9-acre property zoned for Port Maritime Industrial use. The company planning to deliver this is the Denver-based DCT Industrial Trust, which is calling its development the DCT Blair Logistics Center.
The industrial REIT paid on December 2nd, 2016, $28 million to acquire two lots in Tacoma located at 3320 Lincoln Avenue. The seller was SSA Tacoma, Inc., which had owned the property since 2006 when it acquired it for $11.7 million.
The site contains existing buildings, pavement and utilities. All existing structures, pavement and surface improvements will be removed for redevelopment of the site, stated the company's proposal to the city. Existing underground utilities will either be removed or left in place, sealed/filled with control density fill and abandoned. New improvements will include new building construction, paved parking and truck maneuvering areas, landscaping, storm water quality treatment system and stormwater conveyance to existing systems that discharge to Blair and Hylebos Waterway, water and sanitary sewer extensions, franchise utility improvements. Traffic mitigation measures for Taylor Way and Lincoln Avenue are anticipated.
The sale comes just days after another massive sale closed almost next door at the 58-acre former sawmill in Tacoma. The seller was Interfor, a Vancouver, B.C.-based lumber company, which sold the site for $32.4 million. The buyer was Industrial Property Trust (IPT), which purchased the property to develop the IPT Tacoma Logistics Center. The new development will include two industrial buildings totaling approximately 1.1 million square feet.
The DCT sale was brokered by Kidder Mathews' team of Todd Clarke, senior vice president and managing partner in the company's Tacoma office, Matt Wood, senior vice president and managing partner who works out of the firm's Seattle office, and Ty Clarke out the Tacoma office.
The Kidder Mathews third quarter of 2016 industrial real estate market review stated that Pierce County led the way in both leasing and development. On the leasing side, the market achieved 1,165,913 square feet of positive net absorption. With only one delivery (312,795 square feet), the vacancy dropped from 6.87 percent to 5.66 percent. On the development side, eight projects totaling 1,158,060 square feet are underway. Notable projects include the Chinook Building in Sumner (251,437 square feet), Fife I-Commerce Center (250,490 square feet), and Logisticenter 167 in Fife (225,972 square feet). With an ample amount of land still available in Sumner, Port of Tacoma/Fife, and Dupont, there is another 4.3 million square feet in the pipeline for future development.
Notable sales closing during the quarter include LBA Realty's acquisition of the Titan and Apollo Buildings in Sumner from LaSalle Investment Management for $48,050,000, or $112/square foot. Bixby Land Company out of California purchased the Steele Building in Sumner from Panattoni for $24 million, or $116/square foot. One notable lease over 100,000 square feet was Mobis Parts (180,718 square feet) at the Cascade Building in Sumner. Several other leases above 100,000 square feet were signed but will not take occupancy until later this year or early 2017, the report stated.