By Jon Peterson
Denver-based DCT Industrial Trust has signed a 300,000 square foot lease with LKQ at its White River Corporate Center industrial property in Sumner.
This transaction will represent the first time that the property owner and tenant have done a lease on a property in the Seattle market; DCT has signed leases with LKQ in some of its other markets around the country. DCT was represented in the lease with the assistance of the Seattle office of Colliers International. The brokers involved were Bill Condon, executive vice president, and Matt McGregor, executive vice president. The tenant was represented by Thad Mallory, a senior vice president of the Seattle office of Kidder Mathews.
“We are excited to have LKQ as one of our tenants in our new property. We look forward to continue with the leasing efforts on this project and others in the Seattle market,” says Patrick Gemma, a senior vice president for DCT. He works out of the company’s regional office in Seattle. He and the company declined to comment on the length of the LKQ lease.
White River Corporate Center is very reflective of the kind of projects that DCT wants to build or own in the Seattle market. “This is a Class A light industrial project that is a good example of what we are trying to do in the Seattle area. This project in the Kent Valley is less than 10 miles from the port of Tacoma. We expect that LKQ will use this location as a distribution hub to move its products in the Pacific Northwest,” said Gemma.
The project does have some interesting features. “This development will have the first industrial property in the market with 32 foot clear heights, which should be something that a lot of tenants are looking for. The office component of the project will vary from 3 percent to 10 percent of the whole project,” said Gemma.
White River Corporate Center is a 30-acre site where DCT completed the project at the end of last year totaling 649,000 square feet. According to the public REIT’s 2015 second quarter supplemental report, the project investment by DCT is $49.7 million. At this time the property was 33 percent leased.
DCT has had some recent strong leasing success in the Seattle market. It has completed leases totaling over one million square feet in the Seattle market in the past 60 days through eight transactions. “The leasing activity in the Seattle market is the strongest that I have seen in the 15 years I have been involved with industrial properties in Seattle. I think the reason for that is there is limited new product being added to the market and very strong tenant demand,” said Gemma.
DCT has been a developer of industrial properties in the Seattle market since the beginning of 2013. It now has a development pipeline of 1.4 million square feet. Its development portfolio is now 85 percent leased.