By Jeff Jeffrey – Reporter, Houston Business Journal
Original Post from Houston Business Journal
Another speculative industrial development is planned for the booming Brookshire market west of Houston.
Birmingham, Alabama-based real estate investment firm Growth Capital Partners teamed up with Houston-based Phelan-Bennett Development to build Westside 10 Industrial Park.
The 167,120-square-foot warehouse will be built on a 9.75-acre plot just south of Interstate 10. The development is expected to break ground later this month and is scheduled to be delivered in the fourth quarter of 2022.
The building will feature a front-load configuration, a 32-foot clear height, ESFR sprinklers, 50-foot-by-52-foot column spacing, a 60-foot speed bay, 38 dock doors, two overhead doors with a ramp, a 145-foot truck court, 227 car parking spaces and seven trailer parking areas.
The property is being marketed by Lee & Associates’ Robert McGee and Taylor Schmidt. GCP will manage the property.
“This is our first deal with Houston-based Justin Bennett, and we could not be more pleased with the transaction,” said John Grizzle, GCP’s associate vice president of investments. “The partnership is continuing to pursue other developments together and expect to make further announcements soon.”
GCP is funding the project via its GCP Fund II, which has been focused on acquiring and developing bulk distribution warehouses across the Sunbelt during the past six months. The company has set a goal of aggregating a $1 billion portfolio.
This is GCP’s second fund dedicated to the industrial real estate sector. GCP sold its Fund I portfolio in late 2020 to an institutional investor for $802 million. Principals Gardner Lee and John Hagefstration, co-founders of GCP, grew Fund I from an initial roll-up of 24 properties of 4.4 million square feet located in Alabama and Florida to 11.7 million square feet of Southeastern industrial properties, which were 98% occupied at the time of the sale.
For its second fund, GCP has expanded its target market outside of the Southeast to include Texas and the mountain states of Utah and Colorado.
GCP’s Brookshire property comes at a particularly strong period for the industrial market in greater Houston.
A recent report released by CommercialSearch found that Houston ranked No. 6 for projected industrial completions this year among the 20 largest metro areas in the United States. The Bayou City currently has about 18.5 million square feet of industrial projects in the pipeline.
The No. 1 market for projected industrial completions was Dallas-Fort Worth, which has 38 million square feet of industrial space currently in the works.
At a national level, almost 600 million square feet of industrial space is currently under construction.
As for Brookshire, the city has seen a surge of development over the past several years. In fact, Phelan-Bennett Development completed another speculative industrial project, called Jordan Ranch, in the area last year.
Earlier this month, Japanese compressor manufacturer Mayekawa announced plans to occupy a 72,000-square-foot facility that Houston-based Clay Development & Construction is currently building next to the new Medline distribution center. It’s in the Pederson Road Business Park between Interstate 10 and U.S. Highway 90.
Additionally, Dallas-based Hunt Southwest will build a 1.05 million-square-foot spec facility in the Brookshire area, the developer announced March 10. Dubbed the I-10 West Trade Center, the new project is expected to be complete in early 2023. It will be Hunt Southwest’s third speculative industrial development in the Houston area.
The rise of e-commerce has transformed the industrial real estate market as more companies seek to build distribution centers to cut delivery times. That trend only accelerated in the past two years, thanks to a 45% increase in online sales in 2020, according to a June 2021 report by Forbes. Just last year, Houston added more than 17 million square feet of new industrial space, putting it behind only Dallas-Fort Worth, which added 24 million square feet, and Chicago, which added 23.9 million square feet, according to another recent report from CommercialSearch.