By Keith Loria
A joint venture between Ivanhoé Cambridge and CapRock Partners has started construction on the first phase of Colony Commerce Center, a $450 million, Class A logistics complex in Ontario, Calif. The 3 million-square-foot complex is projected to be ready sometime next year.
“We’re currently in a historic market for industrial,” Patrick Daniels, CapRock Partners’ CEO, told Commercial Property Executive. “The Inland Empire is arguably the leading and largest industrial submarket in the country and it has a historic low vacancy rate, now below 2 percent.”
Moreover, there’s a historic amount of new development coming into the market and a great equilibrium between demand and supply. Even in that environment, rates continue to move up. “This area, in Southern-most Ontario, is the Western-most portion of this Inland Empire submarket and it creates the best property now available to develop state-of-the-art industrial product,” Daniels said.
It was in August when Ivanhoé Cambridge acquired two large parcels of land from CapRock Partners, which set in motion the plan to develop Colony Commerce Center. As terms of the deal, CapRock Partners is developing the 11-building, two-phase project on behalf of Ivanhoé Cambridge.
Phase I of the industrial property will comprise 1.3 million square feet of space divided into two buildings of 589,000 and 700,000 square feet, respectively. Both developments are expected to offer 36-foot clear heights, 185-foot-wide truck courts, cross-dock loading, 100-percent-concrete drive areas and excess trailer parking stalls.
Top Industrial Market
Situated at the northeast corner of Carpenter and Remington avenues in the Inland Empire, the property is close by Ontario International Airport and highways I-15, I-10, SR-60, SR-91 and SR-71. It’s also near corporate neighbors such as Walmart, FedEx and Amazon, and is just a few miles away from major retail amenities.
According to Daniels, Southern California, along the West Coast, the Port of Los Angeles and Long Beach, is the largest port in the U.S., two and a half times that of the second largest in New York/New Jersey, and with 28 million people in the area, half the containerized shipments coming into the U.S. come through the port and half stays in Southern California.
“You have multiple drivers driving the demand; you have a historic low vacancy, less and less land available for new development and that’s creating a perfect storm for industrial development at this time,” Daniels said. “It’s exciting to have this project under construction and moving forward.”
CapRock Partners will also develop the second phase of Colony Commerce Center, located directly adjacent to Phase I on the southwest corner of Archibald and Merrill avenues. The complex is expected to consist of a 1 million-square-foot single LEED-certified building with a 40-foot clear height that anchors eight additional small-box buildings ranging from 35,000 to 140,000 square feet.
Since its founding in 2009, CapRock Partners has focused strictly on industrial, and has either bought, sold, repositioned or have in its pipeline over 11 million square feet of industrial space and are currently under construction on 4 million square feet of industrial on five properties.
“We see continuing strong demand for what we do,” Daniels said. Over the past year, Ivanhoé Cambridge has invested more than $2.5 billion in the North American industrial real estate market.
Image courtesy of Ivanhoé Cambridge