Commercial Real Estate

NEWS - Commercial Real Estate

1/11/2010 - The Allen Land Group Inc.of Jacksonville has acquired 140 acres of industrial land in Kingsland to develop a commercial and industrial business park.

“The project is prominently located with frontage on Georgia SR 40 and is approximately 31 miles from the Jacksonville Blount Island Port, which is experiencing a boom in its port activity.  The site is adjacent to the St. Marys Railroad line and conveniently located to the Brunswick, GA and Savannah, GA ports, and Interstates 95, 295 and 10,” according to the company.

The land is being marketed at $65,000 an acre and up depending on size and location, and the owner will consider a joint venture or build to suit.. One  to 80 acre sites, with the potential of building a warehouse or distribution facility up to 900,000 sq. ft. are possible.

The permitted uses include warehouse, wholesale, light industrial, manufacturing, commercial, retail, and professional offices.

The family-owned company is led by Jack Allen, who has been a commercial real estate broker in Florida for over 20 years, first with a national firm and then with his own company started in 1994.  Joining him is his wife Laura Henry Allen, a real estate attorney and advisor to the company.  Laura was associated with the national law firm of Foley and Lardner for twelve years prior to joining her husband at Allen Land Group, Inc. in 1997. Also involved with the company is Heather L. Allen, who supervises and coordinates the permitting of horizontal development of investment properties and formulates land use strategies for larger parcels; she joined the company in 2005. And. John Allen, who handles marketing for the company.

NEWS - Commercial Real Estate

SBJ Staff

12/07/2009 - Curtis Lewis III does not expect much of anything to change within the commercial block he owns from Abercorn Street west to White Bluff.

But that does not mean the property is off the radar of commercial developers, including builders of big-box retail.

Developers see DeRenne Avenue’s high volume of traffic in a mostly different way than do the motorists who must navigate it daily. Those tens of thousands of motorists who pass through the avenue have made top performers of the street’s Burger King and Auto Zone car parts store.

Even the closed-up Captain D’s Seafood fast-food outlet on the south side of DeRenne near the Abercorn intersection performed strongly, said Lewis. “We were told it was the top store in the chain. Yet they closed up when their lease ran out.”

Lewis said the site has drawn significant interest from the fast-food sector but noted significant time and expense would be involved in getting the parcel up to city land-use codes. “The Captain D’s spot has some challenges with the layout,” he said, including entrance-and-exit requirements, parking, green space and stormwater retention.

Nonetheless, he said, “We have a number of national fast-food chains that want the property.”

The same code issues would apply to redevelopment of Globe Plaza and the parcels around it owned by Lewis. Land-use variances would likely be needed, said Lewis, a lawyer.

Yet DeRenne’s traffic counts and the property’s frontage with both Abercorn and White Bluff appeal to developers, Lewis said. “I talk to people all the time about redevelopment.”

Big-box retail developers are among the callers, he added. “We’ve talked to a few. I haven’t got any of them to sign on the dotted line.

“They do like the traffic count.”

Aside from a roadway that connects with most of Savannah’s major traffic outlets, including Truman Parkway,

Abercorn and interstates 516 and 16, DeRenne has some nearby neighborhoods that should interest retailers, said David Sink, a principal with commercial real estate firm Colliers Neely Dales. “The area has some great demographics,” he said, citing Ardsley Park and Kensington Park.

“Once you’re east of Abercorn, it’s all residential,” Sink noted.

He said he’s unsure if the Lewis property is large enough for a genuine big box but it does have room “for some sort of anchor.”

John Rauers, owner of commercial real estate firm Lamara, said he does not expect to see any commercial redevelopment on DeRenne until traffic bottlenecks are eliminated.

And even with improved traffic flow on DeRenne, a redeveloped globe area would still have plenty of retail competition up and down Abercorn, Rauers noted.

For anything to happen, Rauers said, the commercial real estate market would have to rebound strongly and absorption of vacant retail space, including empty big-box stores, would have to occur.

NEWS - Commercial Real Estate

SBJ Staff

Concern over commercial encroachment into a residential neighborhood led Savannah City Council Thursday to reject a proposed rezoning that would allow an Enmark station at the corner of White Bluff Road and Hampstead Avenue.

Enmark had sought rezoning for a two-thirds section of a split-zoned parcel at 9 Hampstead Ave. A third of the property is already zoned Community Business. The service station company asked to rezone the remaining portion from a multi-family residential designation to Community Commercial.

Had the rezoning been granted, the city was willing to sell Enmark a 16-foot-wide right of way that extends 170 feet west of White Bluff.

Enmark can build on the commercial zoned portion of the corner parcel, but its attorney, Harold Yeillin, said the piece of land is “extremely” small and Enmark would have difficulty meeting city drainage requirements. “An enormous number of variances” would be needed, he said.

Would Enmark build on it, anyway?

“Probably no,” Yellin said.

Had Enmark received the rezoning it wanted, the company planned to demolish the old Army-Navy surplus store near the corner and include that land as a buffer to the service station-convenience store complex.

The rezoning proposal went to the City Council with the backing of the Savannah-Chatham Metropolitan Planning Commission and city planning staff. But the aldermen and Mayor Otis Johnson were unanimous in voting against it.
“We can protect the neighborhood by denying this application,” Johnson said just before the vote.

He said his denial vote follows an anti-commercial-encroachment doctrine the city established in rejecting commercial expansion in the Thomas Square area in the middle of this decade.

Alderman Cliffton Jones voiced similar sentiment. Approval would “open the door” for similar requests to intrude onto residential neighborhoods, he said.

Pat Harris, a resident of the Popular neighborhood, said residents do not oppose Enmark building on the corner parcel zoned for business. But “we do have a problem with them encroaching on our neighborhood,” said Harris, secretary to the Popular Neighborhood Association.

In recommending approval, the Metropolitan Planning Commission said the rezoning would be consistent with Savannah’s Future Land Use Plan and “will consolidate a split zoning pattern that currently exists.”

Further, the Business Commercial zoning “would allow for greater flexibility in the design and establishment of a commercial use along this portion of the White Bluff corridor. Potential site,” the MPC said.

The planning agency noted that neighborhood safeguards could be addressed through the development review process.

NEWS - Commercial Real Estate

11/09/2009 - Millions more in construction has been approved for Fort Stewart, for projects planned within the next few years, according to Savannah District U.S. Army Corps of Engineers resident engineer Dave Warren.

"We've awarded a number of large contracts here at Fort Stewart that will impact the local economy," said Warren. "These contracts will give Savannah-area sub-contractors an opportunity to bid. Also, the area will benefit from the high volume of construction workers coming to Fort Stewart everyday."

A $32 million renovation of the Volunteer Army (VOLAR) barracks, built between 1977 and 1984, is on the list. The VOLAR barracks consist of 30 buildings (987,901 square feet) which sleep 2,315 soldiers. Under the renovation contract, the barracks will undergo several exterior repairs, including enclosing and conditioning all stairwells and vestibules, enclosing the courtyard with a translucent roof system and repairing cracks in the brick facade.

The project was awarded in September as two separate contracts to Whitesell Green Yates and Sons of Biloxi. All barracks are expected to be finished by mid-December 2012.

Also on the list of new construction are several new facilities for the 3rd Sustainment Brigade totaling $27 million that the Corps has now awarded under three separate contracts.

Davis Group of Sanford, Fla., won a $7.7 million contract to construct a company operations facility; IL Fleming of Midway, Georgia, won the contract for a $16.2 million brigade headquarters building, totaling 55,300 square feet; and Lifecycle Construction Services of Washington, D.C., won a $3.6 million contract for classroom and storage facilities. These new 3rd Sustainment Brigade facilities are tentatively scheduled for completion in spring 2011.

The Corps is also starting construction on a $315 million Infantry Brigade Combat Team Complex (IBCT) at Fort Stewart, designed to accommodate 3,500 soldiers and 950 wheeled vehicles. The complex is the largest construction project at the base, and one of the largest military construction projects for the Corps’ Savannah District.

The IBCT project consists of six separate contracts, awarded incrementally in order to meet the autumn 2011 completion date. So far, four contracts have been awarded, totaling $273.5 million.

A $150 million contract was awarded in May to Walbridge Aldinger of Detroit for the design and construction of six company operations facilities, six tactical equipment maintenance facilities and all necessary infrastructure for the entire 450-acre site.

Also in May, Archer Western of Chicago  received a $92.7 million contract to construct twenty, 72-man barracks. Later in August, M.A. Mortenson of Minneapolis won a contract to build a $20.9 million headquarters building. The most recent contract was awarded in October to HS Joint Venture of Atlanta, to build a $10.3 million dining facility.

Future contracts to be awarded for the IBCT Complex include a physical fitness facility and a troop medical clinic.

Like all Army construction, these Fort Stewart projects will satisfy Silver rating criteria established by the Leadership in Energy and Environmental Design (LEED), according to Warren.

NEWS - Commercial Real Estate

11/09/2009 - The Federal Deposit Insurance Corporation (FDIC), in coordination with the other member agencies of the Federal Financial Institutions Examination Council (FFIEC), adopted a policy statement last week on “prudent commercial real estate (CRE) loan workouts.”

“This policy statement stresses that performing loans, including those that have been renewed or restructured on reasonable modified terms, made to creditworthy borrowers, will not be subject to adverse classification solely because the value of the underlying collateral declined,” said the FDIC. It was a critically important announcement for the local and community banks that hold millions in commercial loans.

This policy statement provides guidance to examiners and financial institutions that are working with CRE borrowers who are experiencing diminished operating cash flows – such as to empty office buildings – depreciated collateral values, or prolonged delays in selling or renting commercial properties.

“It also recognizes that during these difficult economic circumstances, continued credit availability to businesses, especially small businesses, is challenging, even where borrower performance has been acceptable. This policy statement reflects the appropriate balance of prudent credit practices and meeting legitimate credit needs,” the FDIC said.

“This policy statement details risk-management practices for loan workouts that support prudent and pragmatic credit and business decisionmaking within the framework of financial accuracy, transparency  and timely loss recognition. Financial institutions that implement prudent loan workout arrangements after performing comprehensive reviews of borrowers' financial conditions will not be subject to criticism for engaging in these efforts, even if the restructured loans have weaknesses that result in adverse credit classifications,” said the directive.

The policy statement includes examples of CRE loan workouts, helping banks understand how FDIC bank examiners will be looking at their commercial lending practices.

The examples, provided for illustrative purposes only, reflect examiners' analytical processes for credit classifications and assessments of institutions' accounting and reporting treatments for restructured loans. The policy statement reiterates existing guidance that examiners are expected to take a balanced approach in assessing institutions' risk-management practices for loan workout activities.

The member Agencies of the FFIEC include the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the FFIEC State Liaison Committee. The FDIC currently chairs the FFIEC.

NEWS - Commercial Real Estate

SNF, the largest industrial employer in Liberty County, was recently named the winner of the 2009 Governor’s International Award in the International Trade, Small/Medium Business category at an event in Atlanta presented by the Atlanta Business Chronicle, Metro Atlanta Chamber and World Trade Center Atlanta.
Awards were given in the categories of International Deal of the Year, International Trade in the Large Business and Small/Medium Business categories, International Investment, International Education Program, Individual of the Year and International Lifetime Achievement.
The Liberty County Development Authority (LCDA) nominated SNF, a global leader in the manufacture of chemical products, that has operations in Riceboro and is headquartered in France.  The LCDA noted that SNF exports to more than 60 countries around the world, and from January 2008 to the present, the company has exported 300 million pounds of product from the Liberty County facility.
SNF has made continued capital investment at the Riceboro facility that has allowed for rapid growth in export sales.  The company opened in Liberty County in 1986 with 15 employees, and today the total employment on the site, including contractors, is approximately 1,000 people.
David Kaye, vice president of manufacturing for SNF Chemtall, accepted the award, which was a proclamation signed by Gov. Sonny Perdue.  He stated, “SNF is honored to win the Governor’s International Award.  We have found Liberty County to offer the assets we need to be competitive in a global economy.”
In addition to SNF, Kia Motors, UPS, Mercedes-Benz USA, Georgia Tech’s Center for International Business Education and Research, Jorge Fernandez of the Metro Atlanta Chamber, and John Portman of John Portman & Associates Inc. were named winners in the awards competition.
Julie Bryant Fisher, managing editor of the Atlanta Business Chronicle, elaborated on the selection process by stating, “For each category, we worked to find companies and individuals that not only stood out in their fields, but also made unique approaches to doing international business.”

NEWS - Commercial Real Estate

When it comes to using water in a draught, the Tybee Planning Commission gives a thumbs up to people and thumbs down to cars. But not so with the Tybee City Council, which had its own ideas on the issue. At the council’s first meeting in September, the members voted to approve a petition for a car wash at 1116 Hwy. 80 East, ignoring the Planning Commission’s recommendation to deny the request.
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NEWS - Commercial Real Estate

Information on How Local Companies Can Compete For the Work

Gov. Sonny Perdue announced the approval of 135 energy efficiency projects for state facilities last week, totaling $63.1 million, as part of the State Facilities Retrofit Program.
Funding for the projects is being provided by the Georgia Environmental Facilities Authority (GEFA) through the American Recovery and Reinvestment Act (ARRA), termed the federal stimulus funds.
The energy projects announced last week are projected to save the state approximately $15.1 million a year in avoided energy costs, resulting in a four year payback on the investment and an energy savings of 976,692 million BTUs (equivalent to the amount of energy consumed by approximately 4,544 housing units in one year).
The energy efficiency projects for state facilities include lighting system retrofits, HVAC system upgrades, replacement of inefficient chillers and boilers, advanced control systems, utility sub-metering and building tune-ups (also known as commissioning).
“Many of these projects may go unnoticed to the average Georgian, but the results will be substantial energy savings and a more efficient state government.”
Through the Governor’s Energy Challenge, an initiative of Conserve Georgia, Perdue directed state agencies to reduce energy consumption 15 percent below 2007 levels. He also encouraged businesses, individuals, not-for-profits, schools and local governments to meet the same goal.
“Georgia is leading by example through the governor’s commitment to energy efficiency in state government,” said GEFA Executive Director Phil Foil. “Through the State Facilities Retrofit Program, we’ll make significant progress toward meeting the governor’s 15 percent energy reduction goal.”
All businesses interested in competing for state energy retrofit projects should contact the Construction Division of the Georgia State Finance Investment Commission at www.gsfic.ga.gov and the Board of Regents of the University System of Georgia at www.usg.edu/ref.
Information regarding the energy efficiency and renewable energy opportunities available through GEFA is available at  www.gefa.org.

Editors Note:  A complete listing of the state facility projects along with the estimated yearly energy cost savings and projected length of payback is available with this story online at www.savannahbusinessjournal.com.  Also, a chart is attached that shows the portion of the overall amount that is being used in the different project categories.