Big boxes: Central Indiana's new crop of massive distribution centers.

AuthorMayer, Kathy
PositionFocus

The growth in national chain retailers, rise in the number of third-party logistics companies and Indiana's central U.S. location are creating a booming new crop: distribution centers. About 3.4 million square feet of warehousing space was built in Marion and surrounding counties in 2002, with more on the way.

From books to food, hand tools to DVDs, guitars to equipment parts, what's known as bulk-distribution space is housing and moving products for practically every industry. The newest to be announced is central Indiana's 1-million-square-foot, $28 million distribution and packaging center for tractor manufacturer Case New Holland, to open in Lebanon at Interstate 65 and State Road 32 and employ 700 by the end of 2005. The county already houses some 5 million square feet of distribution space.

The boom prompts commercial real-estate broker Colliers Turley Martin Tucker to dub central Indiana "the Midwestern distribution hub," citing interstate access, low utility costs and the declining and soon-to-be-eliminated inventory tax as factors influencing the surge. And it's only going to keep growing, predicts John Huguenard, principal/senior vice president at Colliers Turley Martin Tucker. The vacancy rate for bulk space in the Indianapolis region is currently only about 10 percent, compared to a national average of 14 percent.

Plainfield alone houses more than 13 million square feet of space in 31 buildings, all built since 1996. "The potential is there to double this to 26 or 27 million square feet of space," he says. "Plainfield is next to the Indianapolis airport. It's the big-box market of Indianapolis."

Mike Curless, executive vice president and principal in Indianapolis' Lauth Property Group--a developer, general contractor and property manager of bulk space--says there's no end in sight for the distribution industry. In the last couple of years, his company built 1.7 million square feet of space in Brownsburg's 400-acre Eaglepoint Business Park at Interstate 74 and Highway 267, which is also served by rail. It's in Hendricks County, but less than eight miles from the Indianapolis airport.

The park's tenants include: HomeGoods, a division of retailer TJX Corp., which occupies 805,000 square feet in a $45 million facility that opened in October 2001; and Guitar Center, the retail musical instrument business, which has a 500,000-square-foot space that came online shortly after that, Lauth recently completed construction of another...

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