by Dan Rafter
How tight is the industrial market in the greater Des Moines area? Jason Conway, director with Opus Development Company, says that vacancy rates in this sector here are in the 2-percent to 3-percent range.
That’s pretty low, and it makes it challenging for users to find modern industrial space in and around the Des Moines market.
“You’d be hard-pressed right now to find contiguous space available in the existing market between 75,000 to 100,000 square feet, and that’s what people here are looking for,” Conway said. “It’s a very tight market.”
That’s why The Opus Group has committed so heavily to building spec industrial space in the Des Moines area. Earlier this month, the company announced plans for a 208,252-square-foot speculative industrial office and warehouse facility in Ankeny, about 10 miles or so from Des Moines.
This new building will be the first stage of the master plan for Corporate Woods Industrial Center, a 50-acre site that can hold up to three buildings totaling 600,000 square feet.
The warehouse will offer 32-foot clear height — quickly becoming a necessity in this market — ESFR sprinkler systems, LED lighting, up to 50 dock doors and 115 parking spaces.
Opus is no stranger to spec industrial. Conway says that the company has millions of square feet of spec industrial facilities under development in several markets, including Chicago, Minneapolis, Columbus and Indianapolis.
The Des Moines industrial market is smaller than these others. But that doesn’t mean that it’s not busy, Conway said. There are plenty of reasons why users are choosing to open warehouses and distribution centers in the Des Moines area, he said.
Conway pointed to the workforce in the Des Moines market. It’s a well-educated one, he said. And Iowa is a right-to-work state.
“It’s easy to work with the labor force in Des Moines,” Conway said.
Des Moines is also in a strong, central location, at the crossroads of Interstate-35 and Interstate-80.
“Des Moines is literally in the crosshairs of two major expressways,” Conway said. “It is within just a couple of trucking days of the entire Midwest of the United States.”
Then there’s the market’s economic resiliency. Conway says that Des Moines didn’t experience the big lows that other larger Midwest markets suffered through during the worst days of the recession.
And that’s not unusual, Conway said. Des Moines does not have a history of high highs and low lows, and that makes doing business here less stressful.
“The Des Moines market didn’t experience the downturn as severely as other markets did when we went through the recession,” Conway said. “People didn’t overextend themselves. The residential housing market wasn’t hit as hard. The Des Moines area had the advantage of not having to come out of this major deep recession as much as other markets had to. And that is paying off today.”
Conway said that construction crews were scheduled to begin moving earth for the new spec facility in late May. The goal is to have the facility built by the end of 2015.
The building will be owned by a joint-venture partnership between Opus Development Company and Founders Properties. Opus Development Company will be the developer, Opus Design Build the design-builder and Opus AE Group the architect and engineer of record.
Marcus Pitts and Justin Lossner with JLL will market the property to potential tenants.
Conway said that potential users are already asking Opus about the property.
“We think it’s going to be really successful,” Conway said. “The market is ready for new industrial product.”