Industrial Park's Owner Bringing in Restaurants, Retail as Amenities for Workers
May 30 2017 - 5:41PM
Dow Jones News
By Keiko Morris
Office developers have in the past turned to restaurants,
entertainment venues, fitness centers and shops as standard
enticements for companies hoping to lure workers.
Now one of the world's largest industrial property owners is
bringing in a developer to add these amenities to its giant
industrial park just outside Miamito cater to its tenants and
freshen up the utilitarian concept of the big-box warehouse
complex.
Prologis Inc. has plans to add about 495,000 square feet of
retail to its Beacon Lakes Industrial Park, potentially bringing in
restaurants, recreational venues and home goods retailers as well
as clothing and sporting goods stores. The sports entertainment
brand Topgolf is pursuing approvals to build a Beacon Lakes
location with high-tech, climate-controlled hitting bays, food
venues, live events and music.
Industrial real estate consultants view Beacon Lakes' addition
of retail amenities as the next evolution in industrial properties
as technology advances and as companies need to recruit and retain
skilled workers in a tight labor market.
"There is no doubt that the market for labor in our business and
additional businesses in this economy has become more competitive,"
said Nick Kittredge, east region president at Prologis. "To work in
a beautiful environment and have amenities at the ready is
definitely a differentiating factor."
Stiles Corp. is developing the retail portion, which will be
designed as an open-air shopping destination with landscaped
paths.
Among the key factors allowing Beacon Lakes to add the retail
segment are the park's critical mass of over 2,000 workers as well
as a location adjacent to Florida's Turnpike and across from the
Dolphin Mall in a densely populated area, real-estate executives
said.
Beacon Lakes is home to logistics and e-commerce tenants such as
United Parcel Service Inc., Amazon.com Inc. and Ryder System Inc.
Prologis owns and manages 2.5 million square feet of industrial
property at Beacon Lakes, with plans to develop an additional 1.6
million square feet over the next two to three years. NBCUniversal
Telemundo Enterprises is building its new headquarters at the site,
bringing as many as 1,100 more workers.
The industrial park workforce has also has been changing to
include executives, engineers, salespeople and designers in
addition to the usual warehouse and operations workers, said Brian
Smith, a managing director at real estate services firm JLL, which
markets Beacon Lakes' industrial space.
"We have a lot of executives visiting," Mr. Smith said. "We see
the amenity base as a strong competitive advantage."
Top concerns for industrial tenants are the availability of
labor and transportation costs, said Chris Zubel, a managing
director at real estate services firm CBRE Group Inc. Training and
hiring employees is also expensive, so these companies are looking
for ways to keep them.
"If all things are equal, the occupier is going to go to the
park that has amenities because it's easier to recruit and retain
employees," Mr. Zubel said.
As an industrial market, the Miami area has served as a staging
ground for exports to Latin America. The metropolitan area's
population growth also has made the area an increasingly attractive
industrial market. The vacancy rate in the Miami-Dade market fell
to 3.8% in the first quarter, a decrease of 0.7 percentage point
from the previous year.
Average warehouse and distribution rents rose 3.2% to $7.04 per
square feet, according to real estate services firm JLL.
While it might be a new evolution of the industrial park
concept, the Beacon Lakes project isn't something that can be
easily replicated, Mr. Smith cautioned.
"The cost of land, the proximity to the right demographics, a
lot of things have to fall in place to do something like Beacon
Lakes," Mr. Smith said.
Write to Keiko Morris at Keiko.Morris@wsj.com
(END) Dow Jones Newswires
May 30, 2017 17:26 ET (21:26 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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