CRG will soon add to its growing logistics portfolio, now that the company has begun development on an approximately 1.2 million square foot bespoke industrial development in North Little Rock, Ark. CRG is building the $105 million facility, which will operate under the real estate company’s The Cubes brand, on behalf of a national Fortune 100 home improvement company.
The unidentified home improvement company and any other business needing large blocks of industrial space would struggle to find existing first- or even second-generation homes in central Arkansas, where the vacancy rate was 3.9% in the first quarter of 2022, according to research by Necklaces. Little Rock is no exception.
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“Tenants looking for large buildings in the Little Rock market will be forced to select a developer for custom construction due to the fact that no large speculative buildings of this size are normally built there,” said Mike Demperio, executive vice president at CRG, says commercial real estate director.
The custom build project is an end-to-end CRG business, with a corporate subsidiary Clayco overseeing construction as builder and another subsidiary, architectural firm Lamar Johnson Collab, having designed the installation. The warehouse and distribution center will occupy a 115-acre site along Interstate 70, near the highway’s intersection with Interstate 440 and approximately 9 miles from the Port of Little Rock. According to Pulaski County records, CRG acquired the land from tulip farms Inc. for nearly $3.5 million.
Construction of the property began in May. When complete, the cross-dock warehouse will offer features typical of Cubes-branded facilities, including 36-foot headroom, ESFR sprinkler systems, high-efficiency LED lighting, as well as numerous dock doors, a trailer storage and parking for cars and trucks. The tenant will occupy the premises under an emphyteutic lease with CRG.
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News of CRG’s North Little Rock project follows the company’s announcement that it was closing its US Logistics Fund II just days ago after raising $300 million with the expectation of $150 million. dollars of additional equity through co-investment vehicles. The fund, which has met its 10% investment target with diverse investors, will focus on developing high-quality warehouse and distribution facilities in well-located key US markets where fundamentals remain strong.
In total, USLF II and its co-investment vehicles expect to be able to produce a total of $1.5 billion in logistics properties in key markets over the next two years.
CRG expects to deliver the custom build project to North Little Rock in the first quarter of 2023.