By Eric Fetters
Herald Writer
A national development company is moving ahead with plans to construct large industrial buildings in south Everett, and already is exploring other potential deals in the region.
Panattoni Development Co. signed a contract earlier this year to buy a 37-acre lot at the intersection of Merrill Creek Parkway and Hardeson Road in the Seaway Center industrial park.
Mike Wells, local partner with Panattoni, said plans for the project, dubbed the Seaway Business Center, call for seven buildings ranging from 40,000 to 120,000 square feet each. The space would be suitable for distribution, warehouse or manufacturing uses.
“We hope to break ground yet this summer,” Wells said. “We are getting our drawings ready for the city’s approval. We would start construction for sure if we have a user committed for lease or purchase, but we may also go ahead with a spec building.”
While no tenant has been signed for the site yet, at least two larger tenants at other Panattoni-developed sites have expressed interest in the Seaway Center project, Wells said. He’s also fielded inquiries from other companies.
“We’ve been real pleased with the response,” he said.
When Panattoni announced its plans for Seaway Center in March, it marked the company’s entry into the Puget Sound area. On the east side of the Cascades, Panattoni agreed earlier this year to join another company in developing 800 acres of industrial property next to the Moses Lake airport.
Elsewhere, Panattoni is a well-known name in industrial development, ranking in the top five among the nation’s most active developers. Based in Sacramento, Calif., it is believed to be the largest privately held development company in the country.
Since Carl Panattoni launched the firm in 1986, it has developed at least 70 million square feet of space – half of that being built during just the past three years. Panattoni Development has developed projects in 50 cities and established 15 offices across the country.
“You don’t get to those levels without the ability to perform,” said Paul Breuer, a senior vice president for industrial sales and leasing with Collier’s International.
Breuer, who works for Collier’s office in Portland, Ore., has known Wells for years and is working on several projects with Panattoni. He said the company has grown relatively quickly by finding and developing quality pieces of land and keeping clients happy.
“Their niche in the market is to take the hassle out of real estate development for big corporate customers.” Breuer said.
That reputation has brought big names – from General Motors and Amazon.com to the Internal Revenue Service – to the company’s client list.
Gary Bullington of Cushman &Wakefield, who will market the Seaway Business Center project for Panattoni, added that the company’s experience in construction gives it an advantage over rivals.
“They build a top-end product,” Bullington said. “And because they come from a construction background, they can provide that product at a very competitive price.”
Panattoni began trying out the Northwest market two years ago, when it hired Wells and started looking around Portland. The greater Seattle area is one of two markets the company has targeted for expansion this year; the other is the Pennsylvania-New Jersey corridor southwest of New York City.
Wells said the Seaway Center site was attractive for the company’s flagship project in this area because the land was already graded and could be built on with a minimum of delays. Also, he seems optimistic about Snohomish County.
“The north end is a very good submarket because there is relatively little industrial land available, and the demand seems fairly strong despite the economy,” he said.
He said that he’s working on another deal in the county, one that may be announced within the next month or two. Additionally, he’s inquiring about sites in the Kent valley.
At this point, Wells is concentrating on industrial space. In the future, Panattoni could build mid-rise and suburban office space in the area, but that market, high in vacancies right now, has to recover first.
While the Pacific Northwest is still a new market for Panattoni, it’s familiar ground to 42-year-old Wells. Born in Walla Walla, he graduated from Oregon State University and has lived and worked in Portland since 1983.
Splitting his time between Portland and Seattle during the past nine months, Wells said Panattoni should have a permanent office established in Seattle later this year.
You can call Herald Writer Eric Fetters at 425-339-3453
or send e-mail to fetters@heraldnet.com.
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