Industrial space in Lee County tops 13.5 million square feet with 1.4 million projected to come on line in the next three to five years. That may be a surprising number to those who consider Lee County a tourist destination or retirement location. In reality, declining interest rates have stimulated an increase in the number of residential rooftops. And as the residential market increases, the need for industrial supplies also increases.

Interestingly, the cooling national economy isn’t adversely affecting industrial demand. Instead, the stock market’s volatility is causing a favorable reaction in the investment property arena. Investors are moving their money into the stable, yet profitable, commercial and industrial property market.

Metro Parkway Corridor — A Lee County Hot Spot

The Metro Parkway corridor from Colonial Boulevard to Daniels Parkway is emerging quickly as one of Lee County’s hot industrial spots. The demand for 5,000 to 10,000-square-foot single-tenant, free-standing buildings with fenced yards, large overhead doors, and truck wells is on the rise. Recent examples include a lease by EXEL Direct, Inc., the exclusive nationwide MAYTAG distributor that leased a 7,500-square-foot warehouse/distribution facility on Arc Way and the sale of a 6,000 +/- square-foot office warehouse on Metro/Plantation to Collier Electric.

Since available inventory in Naples is scarce, the market is moving north. Metro Parkway is centrally located which is an advantage for relocation from Naples. Easy access to US 41, I-75, and the bridges to Cape Coral also provides Naples’ companies a larger pool for drawing trades’ people and laborers.

Billy Creek Commerce Park

Billy Creek Commerce Park is a light industrial campus located along Luckett Road in East Fort Myers. Easy access to I-75 has attracted manufacturing companies such as Fox Electronics, Saftronics, and Heinz Frozen Foods. Phase I is completely absorbed, and Phase II is expected to sell-out within the next three years.

Jetport Interstate Commerce Park

Construction is underway for a 115,000-square-foot dock height distribution facility facing I-75 that will offer many advantages for industrial usage. Completion is expected for the first quarter of 2002. Easy access to the interstate and airport as well as excellent visibility for the corporate logo along I-75 are attractive incentives for this area.

Currently Klocke of America — a German manufacturer, WCI Communities’ construction management offices, the regional post office, and Shaw Industries occupy space in existing facilities.

Proximity to Southwest Florida International Airport is another incentive for industrial users to locate in this area. Nearly 90 percent of the parcels surrounding the park have already been sold.

Alico Road Corridor

The next surge of light industrial development activity is expected to occur along the Alico Road corridor. Several factors contribute to confidence in this area. Most notable are plans for a new upscale industrial park, Lee County’s land use plan — which focuses on industrial use for this area, and the development of Three Oaks Parkway extension to Daniels Parkway. Easy interstate access, available land, and lack of available inventory in Naples and Bonita Springs are driving users to this area.

Bonita Springs — Greyhound Industrial Park

The original Greyhound Industrial Park, built in the 70s, is completely absorbed. Phase II, which features new buildings and an upscale park, is 80 to 90 percent sold. This occupancy rate may also be driven by the lack of available inventory in Naples.

Other Industrial Activity Pockets

Existing smaller parks are scattered throughout Lee County. In south Fort Myers, Andrea Lane is heavily occupied despite older buildings, limited access, and poor visibility. Bayshore Industrial Park in North Fort Myers has been mildly successful; parcels are for sale, but may not offer the geographical convenience needed by industrial users.

Why Lee County? Confidence!

Many industrial users established their businesses in larger markets and are now moving their operations to second-tier markets, like Lee County, for several reasons. Manufacturers, for the construction industry in particular, are following the rooftops. As residential development continues to expand, the need for construction services and industrial supply grows as well. Suppliers want to be at the heart of the action, so they are locating to maximize exposure to a general services area.

Low interest rates are stimulating industrial users to purchase instead of lease. Confidence in the economy is evident as owners seek newer space and are willing to make the long-term commitment to buy. In the long run, purchasing is more cost efficient than leasing, and buyers are taking pride in ownership of new facilities.

Although some projections state that speculative industrial space will decline, evidence is emerging to the contrary. The confidence level in the Lee County market is high, so expect to see more spec space in the coming year. Overall, the local industrial market is keeping up with national industrial trends. Regardless of a softening market, vacancy rates remain low and investments remain high, showing no signs of slowing down into 2002.

Paul Sands is commercial advisor at Grubb & Ellis|VIP-D’Alessandro, a full service commercial real estate company located in Southwest Florida.