Big Box For Lease To Warehousers
WYOMING — Not too long ago, world-class filing cabinets were produced there.
But now the two-story building sits vacant and its empty space constitutes about 8 percent of the total square footage in the metro industrial market.
The former Steelcase Inc. production facility has 857,250 square feet across its two floors and the building sits on 21 acres in Wyoming, at 3780 Eastern Ave.
Pinnacle Properties, a residential and commercial developer from Bloomington, Ind., now owns the structure, having purchased it last February. And S.J. Wisinski & Co., the region's largest commercial real estate firm, has the heady task of finding lessees to fill the massive building.
Wisinski is the second broker that Pinnacle Properties has hired to fill the building, which was dark and dingy when the firm took it over.
Wisinski Vice President Stu Kingma said the real estate firm convinced Pinnacle to invest roughly $250,000 into cleaning about 200,000 square feet of the building, so that a spotless portion of the structure could be shown to possible clients to give them a clear picture of the building's potential.
"It is now in that condition," he said.
Kingma told the Business Journal that he felt good about being able to lease the building, which he noted was built to the highest standards.
The former plant offers industrial power, a compressed air line throughout, heavy floors, and office partitions already in place. When compared to other industrial and warehouse facilities in the area, Kingma felt the building is in a class of its own.
"It's apples and oranges. It's a Chevette and a Corvette, in terms of quality," he said.
The rates are also attractive.
A square foot is going for $2.25 to $2.50 per foot, triple net, about 50 cents below the normal market rate. Pricing a high-quality building at a lower than usual rent makes Kingma believe the entire structure will become a niche of its own.
"(Pinnacle) bought it cheap enough and they can lower the rent and still make an adequate return," he said.
Pinnacle Properties hasn't revealed what it paid for the building. But when Corporate Properties Ltd. of Providence, R.I., first listed it two years ago, it carried a price tag of $8.5 million, a figure that included the property.
Kingma said Wisinski is going to market it to manufacturers and warehousing firms.
"Most manufacturing companies have a need for heavy power and compressed air lines and we have those in place. At some other buildings in town that infrastructure may need to be added at a cost and we can provide it — kind of turnkey," he said.
"Warehousing is a bit less dependent on that infrastructure, but we still have the ability to put them in there and give them a nice truck court on the north side of that building because there is parking for 800 or 900 cars."
Ideally, Kingma would like to lease the building to a single tenant. Being a realist, though, he doesn't think that will happen. So Wisinski is offering the building on a piecemeal basis, with 50,000 square feet being the smallest portion made available.
"The building sets up well for anything larger than 50,000 square feet," Kingma said.
"The ideal would be for a tenant to take 100,000 or larger square-foot space, but 50,000 will work. It's a function of how deep the space gets," he said.
Reports reveal that Pinnacle owns and manages 20 residential properties in central Indiana and Florida and 25 commercial properties that total 3 million square feet. All the company's holdings reportedly have a current market value of over $150 million.
Peter Dvorak is the principal owner of Pinnacle Properties, which formed Wolverine Holdings of Western Michigan LLC for the local purchase.
"It's a product that offers the features and benefits that most users are going to need at less than what historically has been a market rent," Kingma said.
"It provides them a platform at which they can compete on a global basis with a more economic cost structure," said Kingma.
"It will fill. It will just take some time."