Majestic Realty Co., which developed the dual Walmart fulfillment centers in Davenport, is seeking permits for a new 400,000-square-foot distribution warehouse next door.
Majestic's Atlanta regional office filed subdivision plans this month with Polk County and preliminary construction plans with the Southwest Florida Water Management District for a new spec warehouse on 34 acres at the I-4/U.S. 27 interchange.
"It is going forward," Executive Vice President Stan Conway told GrowthSpotter on Monday. "We're in for permitting now. We're trying to break ground in late April or early May."
Majestic paid $5.1 million in mid-2016 for the site, which is just south of the Walmart facility and has interstate visibility. The regional distribution hub along the U.S. 27 corridor has more than 5 million square feet of warehouse space, and Walmart -- with 2.2 million square feet -- occupies roughly 40 percent of that space.
Growing market demand has prompted expansions over the last two years at the nearby Four Corners Business Park and at Park27. McCraney is currently in building a 206,000-square-foot spec warehouse at Park27, at the intersection of U.S. 27 and Dean Still Road.
But the Davenport submarket has the highest vacancy rate (10 percent) in the entire region, according to Avison Young's 2017 Year End Industry Report.
MDH Partners currently has nearly a half million square feet available in its three warehouse buildings at Four Corners, which is at the southwest quadrant of the interchange. Leasing broker Lee Morris, industrial property specialist with Colliers International Central Florida, said he doesn't view the Majestic project as competition simply because he expects to complete the lease-up well before delivery of the new space.
"We've had very good activity" Morris said. "The newest building is 288,000 square feet. It was completed last year, and we've had a series of discussions with single users and some partial users. We would prefer a single user for that space, so we've been somewhat selective."
Last year, Polk County Commissioners rejected a proposal by Seefried Industrial Properties to build another 1.4 million square feet on the east side of U.S. 27.
Majestic Senior Vice President Scott Brown said he followed the Seefried case closely, and he's not concerned about the industrial warehouse vacancy rate in Davenport. The building would be designed so it could be divided, but Majestic's plan is to find a single user.
"If you look at the available product, there's not a Class A building that's 400,000 square feet with an abundance of trailer parking and auto parking," Brown said. "The type of tenant we're chasing would be a bit larger."