With Richmond industrial real estate becoming more difficult to find, a Hanover County developer has plans for 80,000 square feet of new space.
Ronald Hickman hopes to begin work in the coming months on the first of four new office and warehouse buildings, known as flex space, on Atlee Commons Drive. The first building, a 25,000-square-foot structure, will go up on spec, and Hickman plans to start a second when the first is 50 percent leased.
“I own quite of bit of this type of space, and it’s basically full and it has been full,” Hickman said. “This type of rental stuff has done really well during the hard times because it’s more suited for the small business guy that doesn’t need a lot of space – they don’t need the 10,000 square feet.”
Full plans call for two 25,000-square-foot buildings and two 15,000-square-foot buildings on about 5.5 acres. Hickman estimated the entire development would cost $4 million
The properties will be sliced into pieces aimed at smaller tenants, Hickman said, with the first planned for 13 sections of about 1,800 square feet each. He hopes to price the rent at about $6 per square foot.
The project will push Hickman’s holdings in Hanover County to nearly 200,000 square feet. He also owns four 27,000-square-foot buildings at the nearby Hanover Industrial Airpark. Hickman built those properties about 20 years ago, and strong leasing activity has convinced him it’s time to add more space.
“It seems like the proximity to the interstate is one of the things that makes this area thrive, and the whole airport area has done well in the past,” he said. “The vacancy rate in this area has always been really good.”
Hickman recently bought one of the two parcels he’ll build on, a 1.3-acre piece at the end of Atlee Commons Road, for $175,000. He has an adjacent 4.3-acre piece under contract, but would not disclose the pending sale price for that property.
His construction firm RW Hickman Builders will be the general contractor, and EVB is financing the project.
Hickman’s won’t be the only new industrial space in that section of Hanover County. The Wilton Cos. recently built a pair of new flex buildings nearby in the Atlee Commerce Center. Those buildings, at 6,000 square feet and 10,000 square feet, were completed in the spring.
Wilton Cos. Vice President Hunt Gunter said those buildings have attracted several interested parties but no leases have yet been finalized. The more than 140,000 square feet of flex space The Wilton Cos. own at Atlee has an occupancy rate well above 90 percent, Gunter said.
Wilton has another 14 acres in the Atlee Commerce Center area it could build on, and Gunter said the firm will likely begin looking into the next project once the two most recent buildings have leased up. He cited easy interstate access and a planned grocery store development on Sliding Hill Road as draws for the area.
“That will help bring people to the area, and it will be very convenient for the guys that work in the Atlee Commerce Center,” Gunter said of the planned grocery store. “Obviously if I’m building a spec building, we’re very bullish on the area, we think it’s going to continue to do well.”
The activity on Altee Commons joins a pair of other projects in a tightening Richmond-area industrial real estate market.
In Eastern Henrico, Liberty Property Trust broke ground on a spec warehouse aimed at larger tenants and heavier industry than the Atlee Commons buildings in June.
Brandywine Realty Trust also has plans to add three new industrial buildings along Dabney Road. Two of those are flex space buildings and a third will be a larger warehouse. Brandywine will wait until it has preleased half of the planned buildings before starting construction.