Developer plans 2 million-s.f. of light industrial space in S.C.

Dec. 8--Kirco, a Michigan commercial real estate company, plans to invest about $100 million to develop 2 million square feet of light industrial/distribution space in the Carolina Pines Industrial Park off I-77 near Blythewood.

The company has bought the remaining 126 acres of undeveloped property in the park that already includes a Belk distribution center and Amcor plant.

The tract of land, which Kirco purchased from Sony for $2.2 million, is south of Jenkins Brothers Road between Farrow and Carolina Pines roads.

The property is the last of 330 acres bought by Sony in 1981 for a plant that was to employ 500 workers. In 1986, Sony canceled its plans.

Construction on the first 184,000-square-foot speculative building is expected to begin in January and should be ready for occupancy in late summer 2008, said Chip Olsen, a Kirco partner in the company's Charlotte office.

Kirco expects the market to absorb 180,000 square feet of space a year at the park, and preliminary plans call for up to 10 buildings to occupy the property.

But the number of buildings is not firm. The project is designed to accommodate buildings of up to 850,000 square feet.

The project will help meet a critical need for speculative industrial office space in the Midlands.

The Kirco project is going to be very beneficial because a lot of economic development prospects come into a region looking for speculative space, said Mike Briggs, executive director the Central SC Alliance, the Midlands economic development agency.

Areas without available buildings don't know how many prospects moved to other regions with plenty of space, Briggs said.

Alliance developer Mark Simmons said he could count on a couple of fingers on one hand the number of quality speculative buildings available.

The Columbia industrial market has about 34 million square feet of space and a vacancy rate of about 5 percent, said Chuck Salley, a principal at Colliers Keenan, the commercial real estate firm that brokered the land sale.

"That is the entire market: the good, the bad and the ugly," he said.

For industrial brokers like himself, "We are kind of like salesmen selling out of an empty wagon. We've got lots of prospects and little inventory."

Salley said he is currently tracking some 20 deals in the market with prospects looking for space from 20,000 to 300,000 square feet.

S.C. Secretary of Commerce Joe Taylor said, "It is a clear indication that South Carolina is attracting the attention of international companies and developers and also that our state's economy is robust and moving forward. The best way to continue this rend is to have buildings that are available and ready for immediate occupancy."

While Kirco will develop the Carolina Pines Industrial Park buildings for lease, it is not mandatory that Kirco own every building over the next 20 years, Olsen said.

"If someone needs a big piece of property that has all the infrastructure, permitting zoning and everything is ready to go, we are not opposed to selling off some property," he said.

The company has asked to have the property included in the multi-county industrial park that includes Richland and Fairfield counties and is seeking incentives including a fee-in-lieu of property taxes and infrastructure tax credits of $2.4 million.

But Olsen said the company actually expects to spend closer to $6.9 million on infrastructure.

The company also will only get the incentives as jobs are created in the buildings. The $2.4 million infrastructure tax credit would only come to the company over a long period of time as it builds the infrastructure and the amount is capped. Initially the risk is all on Kirco, he said.

Richland County has not finalized action on the tax credits. The multi-county industrial park expansion also has to be approved by both counties.

Kirco, which is a family-owned real estate development, construction and property management company, is based in Troy, Mich. But the company has a substantial presence in Charlotte.

The company developed the 240-acres Westlake Corporate Campus in Charlotte. Nationally, the company has developed more than 11 million square feet of real estate worth about $1 billion.

Business North Carolina recently named Kirco that state's "Most Active Developer for Industrial Space."