Principal and CEO of Industrial Equities
For the first time since the recession, speculative industrial development — projects with no committed tenants — is starting to take off in the Twin Cities as demand for space returns.
Minneapolis developer John Allen, principal and CEO of Industrial Equities, was one of the first out of the gate with Meridian Industrial Center, a 68,000-square-foot speculative project in St. Paul, which opened in August. He's also planning to break ground on a 135,000-square-foot speculative office-warehouse building as part of a recently approved 27-acre development in Fridley. Plans there call for a mixed-use business and multihousing project at the corner of East River Road and Interstate 694, near the city's Northstar commuter rail station. Allen has taken additional land positions for future development, including a 100-acre parcel on Interstate 35E in Lino Lakes.
Allen, 57, launched Industrial Equities in 1983. Through development and acquisitions, he has grown his portfolio of local, multitenant industrial properties to more than 3 million square feet. He also owns Windsor Development, a residential land development company that has completed more than 1,500 residential lots in Minnesota, Arizona and Florida. He got his start as an industrial broker at Coldwell Banker Commercial Real Estate Services and was consistently a top producer. There, he arranged more than 10 million square feet of sales and lease transactions.
Q: You purchased the Fridley site during the downturn.
A: Yes. We were able to make an opportunistic buy. … We have a 135,000-square-foot building approved and teed up to go. In addition to the industrial — which will be high-end, high-tech, flexible space — this site is approved for up to 400,000 square feet of office and 120-plus units of residential. We'll either look to partner or sell the office and/or residential sites. We're in it at the number that allows us to be patient, and we're in a partnership with a city that gets redevelopment.
Q: What attracted you to the site?
A: It's right on the freeway with outstanding visibility and access. … It's served by [Metro Transit] across the street and a block and a quarter from the new transit station.
Q: How's leasing going at Meridian?
A: We have a lease out for signature that will put us at about 35 percent leased. We're in conversations with a number of other tenants that would get us well past the 50 percent mark.
Q: What does the future hold for Industrial Equities?
A: My intention is to continue to identify infill sites that are compatible and bolt-ons to my existing portfolio. … We're very focused and selective and usually when the herd is running one way, we're doing something else.
Liz Wolf is a freelance writer in Eagan. She can be reached at email@example.com.