By Jon Peterson
Chicago-based LaSalle Investment Management and the Renton office of Panattoni Development have formed a joint venture to develop the 206,000 square foot The Reserve at Woodinville industrial development project in Woodinville, Wash.
“I think that there is going to be very strong rental demand for our project. It will be one of the first new Class A industrial development projects in the Woodinville market in some time. This has been the case due to a lack of land to build on. This is a market that remains very tight with the current vacancy in the market being sub 6 percent for Class A industrial space in a market that has around 4.5 million square feet of space,” says Travis Hale, senior development manager for Panattoni.
LaSalle is the main equity source for the development and Panattoni is acting as the development manager. The total value of the development is around $30 million, and Panattoni paid $15.77 million for the land, according to sources familiar with the project. There will be some debt placed on the development that will be in the range of 50 percent loan-to-cost.
The development site is located close to I-405 and State Highway 522. It totals just less than 14 acres of land. The site had been used as a lumber yard dating back to the 1950s, and it had been zoned for industrial uses.
“Construction on this development was started recently. We are hopeful that we will be finished by July of next year. We will have two warehouse/distribution buildings. The design will allow for up to four tenants, but it could be less than that,” said Hale. The project will have a small office component and 30 foot clear heights.
The development in Woodinville is part of $1.3 billion worth of transactions that LaSalle completed during the third quarter across the United States. The other disclosable transactions were located in Portland, Richmond, Calif. two in Phoenix, Los Angeles, Denver, San Diego, Atlanta, Minneapolis and Washington, D.C. These transactions included a mixture of apartments, industrial, office and retail.
LaSalle has now completed a total of $2.1 billion worth of investments in the United States for the year. This compares to $1.6 billion for the region for the same time period in 2015. The real estate manager continues to invest in properties that will benefit from demographics, technology and urbanization driven secular changes in the economy and real estate market.
“I am pleased with the overall pace and quality of our transactional activity through the third quarter. On the acquisitions front, our team was characteristically prudent in their approach, having underwritten a significantly higher number of opportunities relative to the 13 that were closed during the quarter. We will continue to heed market signals and remain selective in both our investment and sale of assets that offer compelling risk-adjusted returns for our clients,” said Jason Kern, chief executive officer for LaSalle Americas, in a prepared statement.