In Riverside, Calif., New Plans for Office Building, Manufacturing Plant

Apr. 19--Two developments planned for surplus military property west of Interstate 215 near Riverside are expected to create 1,000 professional and manufacturing jobs and result in the construction of western Riverside County's first "green" building.

The March Joint Powers Commission on Wednesday unanimously endorsed proposals for a three-story office building by Koll Development Co. and a 356,000-square foot corrugated paper manufacturing plant to be operated by the Fortune 500 company Smurfit-Stone Container Corp.

The manufacturing plant will be the first business in the 1,290-acre Meridian business park to use a rail spur track the Air Force installed a decade ago, said Michael Morris, vice president of commercial development for LNR Property Corp., the park's developer.

Morris estimated the two projects approved Wednesday would generate $50 million in new construction in addition to other large-scale developments already under way in Meridian.The Koll office, called Intellicenter, is the first private project approved in western Riverside County to meet national benchmarks for the design, construction and operation of an environmentally friendly building, Morris said.

He said construction of both projects should be completed by the middle of next year. The Intellicenter building probably will house 800 professional workers once space is leased, he said.

Natalie Bazarevitsch, first vice president of brokerage services and office properties for CB Richard Ellis Group Inc., said she expects floor space in the Intellicenter to lease for between $2.35 and $2.40 a square foot.

The Inland average is $1.96 but demand for quality office space is pushing up the price, Bazarevitsch said.

"We are going to be bringing in the absolute best tenants," Bazarevitsch told the March commission, elected officials appointed to oversee commercial reuse of the former March Air Force Base property.

Bazarevitsch said she expects engineering companies, finance services and mortgage lenders to be at the top of list for those waiting to lease office space, although she said tenants have yet to be signed.

Inland economist John Husing said the professional, financial and engineering jobs the Koll offices would attract should pay $40,000 to $55,000 a year.

Companies that have been tied to coastal areas are looking to relocate as the number of educated workers living in the Inland region increases, Husing said. Between 2000 and 2005, the area saw the number of Inland residents with bachelor's degrees and above increase by 38 percent, he said.

"The labor force is out there," Husing said.

Light manufacturing jobs such as the ones Smurfit-Stone would create have generally been paying $30,000 to $40,000 a year, Husing said.

Thomas Lange, a spokesman for Smurfit-Stone declined to say how much the company would likely pay the 125 to 150 new workers it anticipates hiring.

Smurfit-Stone is the leading producer of corrugated containers in North America, according to the company. It employs more than 25,000 people at about 180 locations, Lange said. The company's sales in 2006 surpassed $7 billion.

David Bowen, senior project engineer for Smurfit-Stone, said rail service will be used once a day five days a week to deliver raw materials to the plant, where they will be turned into everything from shipping containers to end-aisle displays for grocery stores.

March Commissioner Bob Buster, a Riverside County supervisor, said Meridian business park has developed faster than expected.

Tesco PLC, a $73 billion grocery chain and one of the world's largest retailers is building an 820,000-square-foot distribution center in the park. One of Tesco's European-based suppliers, 2 Sisters Food Group, also is constructing a plant in Meridian.

Construction of another 14 office buildings totaling about 79,000 square feet and two warehouses is expected to begin in about four months.

Much of the planned office space will be located near a planned MetroLink station, which could be open by 2012.

"We want people to use the line and take the cars off the highway," said Riverside County Supervisor Marion Ashley, chairman of the March commission.

Morris, the LNR vice president, has said he expects Meridian business park to be home to 20,000 jobs by the year 2020.

Despite the rapid growth, efforts to develop the former Air Force base property has not been without setbacks. The property was turned over by the Air Force for civilian use when March downsized to a reserve base in 1996.

In March, Wild Rocket Foods, a British produce supplier, was forced to withdraw plans to build a distribution center in Meridian after company officials learned they would have to pay $4 million more than expected for wastewater disposal.

A DHL cargo distribution center, the first civilian air carrier to share an airfield on an air reserve base, has drawn continual complaints from Riverside-area residents over early morning airplane noise since it began operating in 2005.

But Lori Stone, interim executive director of the March Joint Powers Authority, said there are many successes despite a few setbacks.

"We are moving forward with some of the higher end development that we did not anticipate this soon," Stone said.

Copyright (c) 2007, The Press-Enterprise, Riverside, Calif. Distributed by McClatchy-Tribune Business News.