The last time the industrial vacancy rate in the Treasure Valley was this low, the year was 2001. Colliers International that year tracked 29 million square feet of industrial space in the Boise area and found only 1.5 percent of it vacant in January.
The conditions back then: Rapid growth in the Boise market, and a lack of speculative building.
Fifteen years later, businesses that are looking for an industrial space to move or grow are finding some similar conditions. The size of the overall market has increased, but after the setbacks of the last several years, builders have been very slow to venture out with speculative building.
However, that’s starting to change. Van Auker Companies of Meridian, the largest industrial developer in the area, is building on spec, producing about 125,000 square feet of space for each of the last several years. A Ketchum company called Strider has joined the market with plans for two spec buildings, one in Boise, and one at the Sky Ranch business park in Caldwell.
In this quarter’s issue of Square Feet, our quarterly publication released July 15 with our weekly paper, we take a look at some of the more interesting areas of Idaho industrial development.
Writer Teya Vitu provides an overview of the market by speaking to some real estate brokers and exploring the landscape as vacancy rates hit new lows once again.
We also examine some of the other industrial development underway around the state. In Eagle, Pacific West Builders is putting the finishing touches on an 81,000-square-foot industrial building that is designed not only for utility but for comfort. Unlike most industrial buildings, the Eagle Tennis Club will include heating and evaporative cooling, a spa, restaurant, basketball courts, and, of course, tennis courts.
Columnist Kimberly Eckman introduces some 2015 rules from OSHA about working in confined spaces, including atmospheric monitoring.
The atmosphere is the focus of a story about the Energy Efficiency Institute at Boise State University. There, engineering professor John Gardner and his students carry out energy efficiency audits on industrial buildings in the Pacific Northwest, seeking to help building owners save money and reduce waste and pollution.
Columnist Wes Jost of Zions Bank presents some readers with financing options for creating those buildings, and ways to see if building on spec is going to pay off. Writer Sharon Fisher puts a spotlight on industrial revenue bonds, a funding mechanism that’s expected to come back into favor as banks look for ways to offer tax savings to borrowers who are doing manufacturing.
There’s no question that with economic growth returning to the Treasure Valley, companies need industrial space. And that builders are hearing the call. If new construction continues its current pace, the growth this year will be the highest the area has seen since 2009.
While Boise can’t compete with larger cities, where real estate investment trusts construct huge industrial buildings, it’s clear that investors are looking for a place to put their manufacturing operations, and local builders are heeding their call.
Anne Wallace Allen is editor of the Idaho Business Review.