News Release
CHILDRESS KLEIN PROPERTIES AND AMSTAR GROUP COMMENCE JOINT VENTURE DEVELOPMENT OF FOUR BUILDING, 890,000-SQUARE-FOOT DISTRIBUTION CENTER PROXIMATE TO PORTS OF CHARLESTON
Acquisition of Final 55 Interior Acres for Development Sites within 261-Acre Charleston Regional Business Center Initiates Project; Property Features Foreign Trade Zone Status, Location within First Drayage Zone and Immediate Access to Interstate Freeway System
CHARLESTON, S.C. (August 17, 2006) – Joint venture partners Childress Klein Properties and Amstar Group today announced plans to move forward with the development of four modern Class A warehouse/distribution facilities on the final 55 interior acres within the Charleston Regional Business Center (CRBC), announced Tricia Noble, partner with Childress Klein. The announcement follows the partnership’s completed acquisition of four land parcels from the master developer of the CRBC, Charleston-based The Beach Company.
“The growth of international commerce and increasing import activity through the Ports of Charleston have fostered a growing demand for distribution center space within close proximity to Charleston’s port terminals,” said Noble. “Childress Klein and Amstar Group saw an opportunity to capitalize on this growing demand by acquiring the last sizable parcels of prime land at this strategically located project and moving forward immediately on this new development. With a lack of large, contiguous blocks of Class A warehouse space this close to the shipping terminals and an increased user demand in the entire Charleston market over the past eighteen months, we are confident that this location will be an extremely popular option with logistics operators when complete in late 2007.”
Strategically located on Clements Ferry Road in Charleston’s Cainhoy submarket, the project sites are positioned to take advantage of the robust growth that the city’s port facilities are experiencing. Recent brokerage reports at mid-year 2006 put the vacancy rate of similar quality distribution space in comparable submarkets at under 10 percent, and availability has continued to tighten as new construction has failed to keep up with increasing space demands.
“Amstar prides itself on working with superior joint venture partners when it moves forward with new development projects, focusing on the benefits of collaboration and shared expertise,” said Gabe L. Finke, chief executive officer and general partner of Amstar Group. “Working with such a strong strategic partner in Childress Klein, one of the most respected names in Southeast commercial real estate development, Amstar is confident that our entry into the Charleston market will result in a project of superior quality when complete. Once committed, both our companies have well established track records for delivering top quality developments, and the depth of capital and technical resources to make them a reality.”
Totaling 889,000 square feet, the four buildings planned for the site will feature modern design formats supporting strategic inbound and outbound logistics and distribution operations. Design plans call for creating superior, modern facilities that will include expansive truck courts with on-site trailer parking, cross dock, front load, and/or rear load formats, 24 ft-30 ft clear heights, and ESFR sprinkler systems. The buildings will also capitalize on their close proximity and short drive times to Charleston’s key port terminals (Wando Welch, Columbus Street, Union Pier, North Charleston, and the new terminal to be added at the former Charleston Navy Yard) ), Interstate freeway access, a location within the first drayage zone and the site’s Foreign Trade Zone status when attracting tenants.
Individual buildings specifications, planned for phased delivery as either spec or build-to-suit projects, call for:
- Building One – 351,000 sq ft, expandable to 700,000 sq ft; 30 ft clear height; Cross dock loading; 50 ft column spacing; ESFR sprinkler
- Building Two – 351,000 sq ft; 30 ft clear height; Cross dock loading; 50 ft column spacing; ESFR sprinkler
- Building Three – 112,000 sq ft; 24 ft clear height; Front loading; 40 ft column spacing; ESFR sprinkler
- Building/Site Four – Approximately 9.4 acres; 75,000 sq ft build-to-suit lease or sale
“Charleston is the nation’s fourth largest cargo processing location, occupying a position only second behind New York/New Jersey on the East Coast, and is rapidly becoming an increasingly popular destination for imports from around the globe,” said Robert A. Toomey, Jr., vice president of Amstar Group. “These modern, Class A buildings will provide a world-class location for various operators seeking cost-effective distribution center locations who require close proximity to Charleston’s port terminals. We are moving forward immediately with site preparation, and will be coming out of the ground by January of 2007 on our first spec phase.”
Within its most recent annual report, The South Carolina State Ports Authority (SCSPA) reported closing its most successful fiscal year ever, posting record container volume, breakbulk tonnage, revenues and earnings. The Port of Charleston set a new container volume mark in the fiscal year ended June 30, 2006 by handling 1,978,806 20-foot equivalent units (TEUs), up just slightly from last year’s total of 1,970,875 TEUs. Total SCSPA breakbulk and bulk tonnage for Charleston, Georgetown and Port Royal also increased, rising to two million tons.
These increases are a direct result of evolving logistical patterns in the global economy. East Coast ports are currently experiencing unprecedented growth in container volume due to growth in Asian trade. Historically Asian shippers have utilized the ports of Southern California – particularly Long Beach -- as their primary port of entry. Logistical concerns with the California Ports (labor disputes and long anchorage times) have large retail shippers seeking viable shipping alternatives to avoid, or at least minimize, these persistent and costly timely delivery obstacles. These concerns have resulted in two trends that directly benefit the Port of Charleston; (i) Asian shippers have concluded that it is cost effective to travel through the Panama Canal and dock within east coast ports and (ii) big shippers and logistical companies will ultimately have warehouses on both coasts in order to process inbound shipments. Congestion delays ultimately mean it is no longer practical for shippers to operate a single national bound gateway in Southern California.
About Childress Klein Properties
Childress Klein Properties is one of the larger real estate development, investment and management companies in the Southeastern United States. The company, and its predecessor companies, have been in business in the Southeast since 1976. Childress Klein Properties is currently active in Georgia, North Carolina, South Carolina and Virginia through offices in Atlanta and Charlotte. With owned real estate assets in excess of $1 billion, the partners of Childress Klein Properties have over 100 years collective experience in the planning, development, leasing and management of over 35 million square feet of commercial real estate. Our owned and managed properties currently total over 22 million square feet and include office buildings, shopping centers, mixed-use developments, warehouses, manufacturing plants, distribution facilities and business parks. For more information, please visit www.childressklein.com.
About Amstar Group, LLC
Established in 1987, Amstar Group is one of the leading real estate private equity firms in the United States. The Denver-based company invests nationally in value-add acquisition and development opportunities, often with local partners. In its history Amstar has acquired, developed and sold more than $2 billion of real estate. Amstar’s current portfolio includes a mix of office, multifamily and hospitality holdings in addition to a development pipeline of industrial, office, multifamily and retail projects. For more information about Amstar Group visit the company’s website at www.amstargroup.com.