by Dan Rafter
HSA Commercial earlier this month watched as crews from Fishers, Ind.-based Meyer Najem began construction of the company’s 220,000-square-foot spec industrial building in the Gateway Business Park in Plainfield, Ind.
The project, which HSA is developing in partnership with Great Point Investors, is a big one for the company. And it’s yet another sign that the industrial market in the Indianapolis area — Plainfield fits snugly in the Indianapolis market area — is thriving.
“We operate in a number of markets, and the Indianapolis market is very active,” said Robert Smietana, vice chairman and chief executive officer of HSA Commercial. “The vacancy rates in industrial have dropped down to 3 percent to 4 percent, which signals to most people that there is an undersupply in the marketplace.”
The new building, which will sit on 13 acres just southwest of the Indianapolis International Airport, will feature 32-foot clear heights, 24 truck doors, four drive-in doors and 155 parking spaces.
HSA’s building won’t be the first new spec industrial building in the Indianapolis market. That market, and particularly the Plainfield area, is already home to several spec industiral buildings that are either in construction or have recently opened to tenants. But HSA’s project is unique: It is catering to smaller users that will need from 40,000 to 100,000 square feet.
And even with all the new spec construction in the area recently, there aren’t many new industrial buildings targeting these smaller users, Smietana said.
“A lot of the new spec product is very large buildings that are hard to divide into smaller spaces,” he said. “The buildings that we are seeing that have been recently developed have a minimum size of 400,000 square feet. These buildings only appeal to very large tenants. The tenants that we are seeking, the ones that need 50,000 square feet to 100,000 square feet of space, do not have a lot of alternatives right now.”
Smietana is confident that HSA’s new industrial building will quickly attract tenants once it opens in the spring of 2014. HSA, after all, already has enjoyed success in the Gateway Business Park.
The company already manages two buildings in the park that are each a little more than 100,000 square feet and a third building that is about 35,000 square feet. All of these buildings are fully leased.
Why has the Gateway Buisness Park been such a success for companies like HSA? Smietana points to a common reason:
“Location, location, location,” he said.
Of course, the business park’s location wasn’t always so ideal. The big positive came when the west entrance to the Port of Entry — Indianapolis Airport moved. The new terminal is now closer to the business park. The Ronald Reagan Parkway, which opened in 2008, is another positive, bringing additional traffic past the site. That road’s recent extension also helps draw attention to the business park.
Then there’s the park’s location adjacent to Indianapolis’ airport.
While HSA officials are understandably excited about the prospects for their new industrial building, they also recognize that the spec industrial boom in the Indianapolis market is not nearly running out of steam. Smietana says that Indiana’s reputation as a business-friendly state is helping to attract new industrial users to the region, including such major players as Amazon, which has already taken significant space in the area for its distribution centers.
“This is a business-friendly state,” Smietana said. “Coming from Illinois by comparison, Indiana is very pro-business. This is becoming a real desirable place for businesses to locate in the Midwest. It’s a great place to be doing business.”