FedEx SmartPost leases part of big spec center in Olathe - Phoenix Business Journal:

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on Thursday signed a long-term lease for 126,00o0 square feet in the 602,000-square-foot spec buildingt completed in late 2008 at22101 W. 167ty St. in Olathe. Constructefd in response to growing demand forlocalk “big box” industrial space, the distribution center was developesd by of Wellseley, Mass., and a partnership led by Dan Jensen, a principa with in Kansas In 2007, when the 40-acre site for the structur was acquired, Jensen said he would target large tenants that would take at least one-third of the “We’re breaking it a little smaller than we thought we might,” Jensen said of the FedExx lease.
“But (landing) FedEx, we think, is a real endorsement for that building andthat location.” FedEx an expanding division of FedEx Ground that delivers packages to U.S. postal facilities for final delivery, will use the spacde for sorting and distribution Jensen said. “We’ve been working on this deal since October, which is indicative of what’s going on in this Jensen said. “It’s just a slow grind. But we do have some othetr deals that aregetting closer.” Space in the new distributionn center is being marketed at $4.256 a foot plus operating tax, insurancse and maintenance costs.
However, tenants will be able to take advantagd ofa 10-year, 50 percent property tax abatemenr the city of Olathe granted. Banking on continuingv demand in Olathe, Jensen’s partnership and Sun Life acquired 200 acre s at the southwest corner of 151sy Street and Old 56 Highway late in 2008 for the eventua l development of anadditional 2.9 millionm square feet of industrial “The industrial market has pulled back a little bit sincwe then,” said Ed Elder, president of .
But Elder, who representec when a pre-recession wave of logistics activitt brought itto Olathe, remains bullisg on Southern Johnson County and the broader Kansazs City area as growing hubs in the nation’ws product-distribution network. In 2007, PacSun opened a 400,000-square-foot warehousw on 74 acres along167th Street, immediately north of Jensen’s spec At the time, those marketing industrial properties in the area benefited from the plannee development of a 1,000-acre industrial park surroundinhg a truck-rail intermodal facilit near 196th Street and U.S. Highway 56 in Gardner.
BNSF announce d early this year that the economy had promptex it to postpone indefinitely construction on the rail portion of theproposed $735 million intermodal park. But Eldet said the area’s existin g assets, including quick access to Interstate 35 andothee highways, will be enough to attract additional tenantx once the economy improves. “It helped promote and validatethat area,” Eldert said of the BNSF “But PacSun got done without it. Kimberly-Clarik did their deal (for a 450,000-square-foot building near Gardner) without it. And Colemajn obviously did not need to beon (an campus.” The latter reference was to a 1.
1 million-square-footr distribution center that Inc. is building in the , a 151-acrwe industrial park at 175th Streetand U.S. Highwayg 56 in Gardner. Ken Block, one of Kansasw City’s top developers, announced in March that he was enterinfg SouthernJohnson County’s emerging big-box industriaol market at a site just east of the new Coleman Block, a principal of , leads an investment partnership that boughtr 229 acres at the northwest corner of 175thu Street and Hedge Lane in On that site, Block & Co.
plans to develop a $275 millionh project containing more than 3 millionm square feet of industrial buildings during the next 10 to 12 Brent Hansen, research services manager for Grubb Ellis/the Winbury Group, said no industrial vacancy statistics are available for the Southernh Johnson County market. But the industriak vacancy rate for all of Johnson Count in the first quarterwas 6.3 in line with the strong metrowide averaged of 6.1 percent.