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|  Tuesday, August 14, 2007 |
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Industrial market struggles in first half of year
Despite Indianapolis maintaining strong incentives for industrial development-like a solid transportation network and a relatively low cost of doing business-the area's industrial market experienced a sluggish first half of the year. Meridian Real Estate said in its midyear 2007 report that reasons for the downturn aren't entirely clear, but they cite as possible explanations tough competition from neighboring markets and factors outside the real estate industry, such as rising fuel costs and the move away from large, single national distribution centers to smaller, multiple regional properties. Looking ahead, Meridian says rising interest rates and the outcome of property tax reassessment in Marion County could continue to hurt the local industrial market. 
Projects
- Revel and Underwood Inc. has completed a 12,000-square-foot retail building in McCordsville Corner Shoppes, which the
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|  | Indianapolis-based firm is developing. No tenants have been signed. Another 16,000-square-foot building and development on two out parcels are planned; a start date for the second building has not been determined. The total project is estimated at $4 million. It includes a third out parcel that has been completed and will be occupied by Greenfield Banking Co. Among other projects, Revel and Underwood for the past 10 years has focused on developing self-storage properties nationwide, including Carmel Drive Self Storage and Michigan Road Self Storage.
- The Indianapolis Marriott East is building a 6-story tower that will add 60 rooms to the 255-room hotel. The $10 million expansion also will include a 8,500-square-foot ballroom and conference room space. The hotel, at 7202 E. 21st St., is owned by Shadeland Enterprise.
Sales/acquisitions
Kitley Industrial Park, which is comprised of three warehouse/distribution buildings that span 363,750 square feet, has been sold for an undisclosed amount. The buyer is a joint venture between Baltimore-based Alex Brown Realty Inc. and Sydney Partners LLC of Chicago; both are real estate investment companies. Kitley Industrial Park sits at 250-258 Kitley Ave. The fully occupied complex is occupied by several tenants, including FedEx Corp., CVS Caremark Corp., and Commodity Logistics Inc. The seller was Los Angeles-based Cohen Asset Management Inc.
Leases/leasing contracts
- Hachette Book Group USA, a publishing company owned by Hachette Livre in France, has renewed a 10-year lease for 809,000 square feet at 121 N. Enterprise Boulevard in Lebanon. Patrick Lindley , with Colliers Turley Martin Tucker, represented the tenant. Jay Archer of Duke Realty Corp. represented the landlord, Dugan Realty L.L.C.
- Aircom Manufacturing Inc. renewed a 35,000-square-foot least at 2402 N. Shadeland Ave. Mark Stephenson and Tony Hupp of Summit Realty Group represented the landlord, Shadeland South Business Park LLC. The tenant was represented by Bart Book and George Charbonneau of Colliers Turley Martin Tucker.
- Deborah Wood Associates renewed its lease for 29,248 square feet at 630 W. Carmel Drive in Carmel. Chris Carmen with Carmen Commercial Real Estate represented the tenant. John Vandenbark with CB Richard Ellis represented the landlord, Atapco Carmel Inc.
- Applied Intelligence has leased 9,160 square feet at 9325 Uptown Drive in Indianapolis. Debbie Mann of Mann Properties represented the landlord, Mann Properties . The tenant was represented by David Black and Cindy Clark of Grubb & Ellis Harding Dahm & Co.
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| Investments/financings/stock sales
Kite Realty Group Trust reported funds from operations in the second quarter rose 13.6 percent, to $11.7 million. At the end of June, Kite had ownership in 48 retail properties spanning 7 million square feet. Occupancy was 95.7 percent. At the end of the quarter, Kite had 10 retail properties in its pipeline that are expected to total 1.5 million square feet, less than half of which will be owned directly by Kite. Project costs associated with those projects is $183 million. Kite is redeveloping Glendale Mall and has renamed it Glendale Town Center.
Housing
The pace of mortgage loan activity advanced 8.1 percent last week, from the week before, according to the Mortgage Bankers Association weekly survey. Refinancings accounted for 39.9 percent of all applications, compared with 39.4 percent in the previous week. Interest rates on 30-year mortgages averaged 6.41 percent, down from 6.50 percent. Rates on 15-year loans decreased to 6.16, from 6.20 percent.
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| People
- Bob Chapman has been named chief operating officer at Duke Realty Corp. Chapman had served as Duke's senior executive vice president of real estate operations since 2003; he's been with the company since 1997.
 - Century 21 Scheetz has hired the following realtors: Mark Covey and Stuart Wilson in the Greenwood office, Steve Carman in the Carmel office and Kent Cashdollar downtown.
- Laura Musall has joined Century 21 Realty Group-McCoun as a sales agent in the Fishers office.
Simon defending Fashion Mall turf
 At least one local broker thinks Simon's plans to expand the Fashion Mall are a competitive jab at Premier Properties, which is planning a mixed-use development called Venu southwest of the intersection of 86th Street and Keystone Avenue. Sam Smith, CEO of Resource Commercial, said he isn't sure Simon's expansion is a "brilliant" move since second-floor retail doesn't do as well as first-floor shops. Simon plans to begin construction next year on a 150,000-square-foot addition to the Fashion Mall. The long-rumored addition of a second level on the west side of the property will add about 20 new shops.
Read the item above and more real estate conversation starters at Property Lines, IBJ's real estate blog. You can link to the blog, which is hosted by real estate beat reporter Cory Schouten, at www.ibj.com.
Edited by Tracy Donhardt
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