press-release
Louisiana firm making a major investment in Broadway corridor
San Antonio Business Journal - by Tricia Lynn Silva
May 12, 2008
A real estate firm out of Shreveport, La., has a plan to revamp an older industrial building in San Antonio -- and thus breathe new life into a stretch of land just outside of the city's inner loop.
Sealy & Co. Inc. has purchased a 186,000-square-foot industrial building at 9315 Broadway in North Central San Antonio.
Sealy has already begun a major rehab of the property -- including revamping some 150,000 square feet of distribution space in the property, says John H. Vogel, a broker and principal with the local office of Henry S. Miller Commercial.
Another 36,000 square feet of office space at the front of the 9315 Broadway building is fully leased to the Blue Bubble Ball Room, and will remain as is.
Joseph M. Carroll, vice president of locally based Cavender & Hill Properties Inc., represented the seller, the Warmack family out of Arkansas.
The property dates back to the 1960s.
Sealy will also re-surface the parking lot and put in new store-fronts for tenants. A fence topped with razor wire that once ran along the perimeter of the property has been torn down, says Vogel, who is also marketing the property to potential tenants.
Those efforts have already netted one user. Portland, Ore.-based Johnstone Supply has inked a lease for 28,000 square feet of space. Of that, 7,000 square feet will be finished out for office use, and the remainder will be used as warehouse/distribution space, Vogel says.
Johnstone is a leading distributor of parts, supplies and equipment for companies in the HVACR (heating, ventilation, air conditioning, refrigeration) industry.
There remains 122,000 square feet of warehouse space up for grabs in 9315 Broadway. That space will be broken up into smaller segments -- including a 50,000- and a 22,000-square-foot space. Two more spaces, measuring 25,000 square feet each, are also available, Vogel says.
Those remaining spaces are being marketed to the "distribution tenants who need to be close to the (San Antonio International Airport)," Vogel adds. "The area is very strong for trade-related businesses -- i.e., the electrical contractors, plumbers, HVAC suppliers."
Vogel expects that Sealy will invest about $2 million to rehab 9315 Broadway.
The goal is to have 9315 leased up by the end of the year, Vogel says.
That's not an unrealistic goal, notes Kimberly S. Gatley, senior vice president and director of research for locally based NAI REOC Partners.
The lack of large blocks of industrial space along the Broadway corridor makes 9315 a sought-after product, Vogel and Gatley say.
Rising construction costs, Gatley adds, have also made older properties attractive to large owners like Sealy -- owners that are willing to invest to keep these assets from falling into functional obsolescence.
"A new owner can bring ... new life to a property," Gatley adds.
By the numbers
Sealy is increasing its presence in San Antonio's industrial market at an opportune time.
According to the first quarter industrial market analysis released by NAI REOC, leasing activity during the first three months of 2008 resulted in the market absorbing more than 320,000 square feet of space.
"Typically, the first quarter (of the year) is fairly flat," explains Gatley. But the leasing momentum that began in 2007 has spilled into the first quarter of 2008, she adds.
Over the 12 months of 2007, a total of 1.8 million square feet of new industrial space entered the market. As a result, vacancy numbers were up slightly on a year-over-year basis.
It's a short-term hiccup. With demand for San Antonio's industrial properties still very healthy, vacancy numbers will fall as the new space is leased up, says John Greg Turcotte, senior vice president and partner with NAI REOC.
"The industrial market is in good health," says Turcotte, who adds that San Antonio continues to evolve into a major distribution hub.
URL:http://sanantonio.bizjournals.com/sanantonio/stories/2008/05/12/story7.html
Back to News