The Zacher Co. recently released the Northeast Indiana Industrial Survey, which showed that demand for industrial real estate in the region keeps growing. That’s good news for the region. Northeast Indiana has earned a reputation for its business climate and has experienced strong interest from businesses considering locating or expanding here in recent years.
That success has left the region with a low inventory of available buildings. As a result, northeast Indiana is losing out on attracting some businesses to the region.
The Northeast Indiana Regional Partnership is charged with marketing the 10-county region to site selectors and business owners. Most business leads that economic developers deal with contain requests for existing buildings. While the region has some available buildings, they are often not competitive when looking at the specifications or quality being requested.
Over the past two years, 80 percent of leads the partnership has been directly involved with required existing buildings. That percentage correlates well with projects issued by the Indiana Economic Development Corporation.
Since 2012, the partnership has received nearly 30 building requests. When looking at the square footage requirements, the region has had few available buildings that meet those requests. Most often it has had even fewer buildings that have the desired ceiling height.
With most businesses preferring to move into an existing building versus waiting to have one built, northeast Indiana faces a harder time attracting businesses even if it competes well on other factors, such as location, business operating costs, taxes and workforce readiness.
Site selectors and business decision-makers are taking note of the work we are doing to make northeast Indiana a globally competitive place to do business. However, when we don’t have a suitable building that a business can occupy immediately, we often lose the opportunity to compete. In order to remain on many businesses’ lists of potential locations, we have to be able to point to an inventory of buildings for them to consider, said Alan Tio, president of the Whitely County Economic Development Corporation.
One solution is to construct a shell building. Shell buildings are nearly complete and can be easily and quickly modified or expanded to meet a specific business’ needs.
Three shell building projects have been announced in the region in the past 12 months.
In July 2013, Greater Fort Wayne Inc., formerly known as the Fort Wayne-Allen County Economic Development Alliance, and CME Corporation broke ground on a 60,000 square-foot shell building on Hatfield Drive in Fort Wayne.
A month later, Whitley RC Investments announced construction of a 75,000-square-foot building in the Rail Connect Business Park in Whitley County.
In January, Wells County commissioners voted to support a public-private partnership for the construction of a 200,000-square-foot building in the Bluffton-Decker Industrial Park in Bluffton.
We are very encouraged by the three shell building projects and are hopeful that more communities will follow suit, said Dale Buuck, vice president of business development at the regional partnership.
The three shell building projects currently in the works will help alleviate the shortage of available buildings in the region, but northeast Indiana will continue to see a market demand for existing buildings.
If the region doesn’t have an inventory that businesses are looking for, it will be harder to stay on the list of potential locations, even if northeast Indiana has the infrastructure, workers and utilities in place.