Merritt Properties Starts Work on $10M Speculative Flex Building in Ashburn
- Sep 15, 2014
By Adrian Maties, Associate Editor
Merritt Properties is trying to take advantage of the tightening Northern Virginia industrial market. The company announced on Sept. 10 that it has started construction on a speculative flex building in Loudoun County.
The new building will be located at 20700 Loudoun County Parkway in Ashburn, just across the street from the One Loudoun mixed-use development. It will have 72,900 square feet of space, with 20-foot clear ceiling heights and typical bay sizes of 2,700 and 3,300 square feet. Merritt Properties will invest $10 million in the project and announced that it expects to finish construction by January 2015. The company also said building uses will vary from distribution to recreational to medical care and educational.
“While the economy has certainly forestalled many commercial developments, the business-friendly mindset of Loudoun County has enabled Merritt to move forward on this project, confident that the county will continue to be supportive of us as well as our future tenants,” Scott Dorsey, CEO of Merritt Properties, said in a statement for the press. “We are grateful for their understanding of the critical role that private business plays in job creation and the overall economic health of the state.”
This will be the fifth building developed by Merritt Properties in the state of Virginia. Other developments include Beaumeade Corporate Park, Ashbrook, Loudoun Tech Center and University Center. According to the developer, the new facility will be specifically modeled after Beaumeade Corporate Park.
CBRE reports that the Northern Virginia industrial market experienced its fifth consecutive quarter of overall positive net absorption in the second quarter. The region’s overall vacancy dropped by 0.7 percent over the quarter, to 10.4 percent. Warehouse vacancy registered a drop of 0.9 percent to 9.1 percent, while the flex vacancy rate only dropped 0.3 percent to 12.4 percent.
Although the overall industrial rent increased by 24 cents per square foot, reaching $9.95 per square foot on a triple-net basis, flex product averaged $11.55 per square foot in the second quarter, a decrease of 10 cents from the first quarter. Warehouse rents in the region increased by 38 cents during the same period, ending the second quarter of the year at $8.67 per square foot.
Charts courtesy of CBRE.