By Jon Peterson
Denver-based DCT Industrial Trust has started construction on the development of the 251,000 square foot DCT White River Corporate Center Phase II North in South Kent Valley. This total investment in the project by the REIT is $21.8 million, according to the company’s second quarter 2016 earnings report. This figure includes all of the constructions costs for the development.
“We have had tremendous success with our other two industrial buildings in this project. These buildings were 650,000 square feet and 60,000 square. These properties were started on a spec basis and they are now 100 percent occupied. We feel good about starting our third and final building in the project on a spec basis,” says Patrick Gemma, a senior vice president with DCT. He oversees the investments and developments for the company in the Seattle marketplace and works out of the Seattle office.
The last building in the project will has 32-foot clear heights and ESFR systems, which will make it a state of the art project for the Seattle area. The property is designed with an office component in the range of three percent to five percent. The leasing efforts on the project will be done through the Colliers International office in Seattle. The listing agents are Bill Condon and Matt McGregor. They are both executive vice presidents and have been involved in leasing all three buildings in the project.
The overall design of the new building would allow for as many as three tenants to move into the property. “Our preference would be to lease the building to one or two tenants. I would think the tenants would be looking to move their products around the Seattle market or maybe on a regional basis down to Portland,” said Gemma.
The land for the new building totals 13 acres. The new property should be completed sometime during the fourth quarter. The last building in the development is part of a 50-acre property in which DCT first invested in 2012. The total square footage of the entire project is around one million square feet of warehouse/distribution space. “This entire project has an excellent location being close to I-5 and I-167. It’s also about 15 minutes from the Port of Tacoma,” said Gemma.
The industrial market in the Kent Valley remains very strong. “This market is as strong as I have ever seen it. Vacancies are at all-time lows at now below five percent. Rents in the market have increased by 25 percent over the past three years and there should be more rental rate growth this year,” said Gemma.