TREX, a Virginia-based composite decking company, has leased the entirety of a 324,000-square-foot warehouse-distribution building at the Mid-Atlantic 81 Logistics Park in Berkeley County, West Virginia. Equus Capital Partners, which holds a diverse portfolio of commercial and residential properties, is the landlord.
The Mid-Atlantic 81 Logistics Park is a 150-acre industrial park on Interstate 81 mid-way between Hagerstown, Md., and Winchester, Va., in the I-81 industrial corridor of the North Shenandoah Valley market. The building that TREX will occupy was built by Equus as a speculative development and completed in late 2023.
READ ALSO: How Logistics Developers Can Surmount Inventory Hurdles
The TREX lease brings the three completed buildings in the Mid-Atlantic 81 Logistics Park to 100 percent occupancy. Previously, Equus completed build-to-suit developments for Procter & Gamble (356,000 square feet) and Clorox (580,000 square feet).
Both of those projects are warehousing facilities that support local manufacturing operations for their respective manufacturing giants. One more pad in the park is undeveloped: a 25-acre parcel which is fully engineered and approved for a 369,000-square-foot industrial building.
Equus has been an active industrial investor and developer recently. In March, a fund sponsored by the company acquired a nine-property, 1.4 million-square-foot industrial portfolio in the Charlotte and Piedmont Triad industrial markets in North Carolina for $124 million.
Late last year, aerospace giant Northrop Grumman Corp. said it will invest more than $200 million to establish a new 315,000-square-foot advanced electronics manufacturing and testing facility in Waynesboro, Va. Equus will develop that facility for Northrop.
North Shenandoah Valley industrial absorption strong, development weak
During the first quarter of 2024, the North Shenandoah Valley industrial market experienced 2.3 million square feet of absorption, according to Colliers, almost all of which was for warehouse space. That was a surge from the same quarter a year earlier, when absorption was 800,000 square feet.
At the end of the quarter, just under 1.7 million square feet of space was underway in the market, which represents not only a drop from the previous quarter’s total of 2.7 million square feet, but a virtual collapse compared with a year earlier, when 10 million square feet of industrial was underway, Colliers reported.
The industrial vacancy rate decreased by 150 basis points in the first quarter of 2024, ending the quarter at 12.1 percent. This is up from 6.2 percent a year ago, due to the delivery of a substantial amount of new product in the interim, noted Colliers.