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VOL. 130 | NO. 207 | Friday, October 23, 2015

Huge Memphis Industrial Lease Caps Busy Q3

By Madeline Faber

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The largest lease of the year has gone to a Fortune 500 Company.

TJX Cos., the parent company of T.J. Maxx, Homegoods and Marshalls, signed on with 800,000 square feet at Memphis Oaks III in Southeast Memphis.

Cushman & Wakefield/Commercial Advisors, who represented building owner Panattoni Development Co., were unable to confirm the new tenant. But a CB Richard Ellis Memphis Industrial MarketView report named T.J. Maxx as the tenant in the deal, which was the third quarter’s largest industrial lease transaction.

PATRICK WALTON

The deal will create hundreds of jobs and millions in capital investment, according to C&W/CA principal Kemp Conrad, who represented Panattoni in partnership with Patrick Walton.

“The TJX deal shows the continued strength of the market,” said Patrick Burke, senior vice president of industrial services with CBRE Memphis. “The previous tenant, Sharpe, needed to vacate early and TJX leased the space prior to their expiration.”

KEMP CONRAD

“We appreciate the confidence of our new customer in Panattoni and are glad to take our Memphis portfolio to 100 percent leased,” said Whitfield Hamilton, Panattoni’s regional director. “This deal represents good growth and investment in process and people for the Memphis market, and demonstrates that there is sustained absorption in Shelby County.”

Last week, Panattoni filed a $5 million building permit for interior alterations to the Memphis Oaks III warehouse, at 3860 E. Holmes Road. The building, which measures a little more than 1 million square feet, is appraised at $25.1 million, according to the Shelby County Assessor of Property.

Michael Reid and Tim O’Callaghan of commercial real estate firm Binswanger represented the tenant.

The TJX deal capped a busy quarter for Memphis industrial, which saw more than 2 million square feet of positive absorption. The market is having its best year since 2000, according to the CBRE report, with cumulative 2015 absorption approaching 6.5 million square feet.

The vacancy rate, which dropped from 9 percent in second quarter to 8.6 percent last quarter, hasn’t been that low in 15 years, according to CBRE.

Panattoni’s Hamilton also said the building “was the last spec building built in Memphis.”

But while there is no more available spec space in Memphis, new construction is coming down the pipeline with an estimated 1.5 million square feet set to be delivered to the market in fourth quarter 2015. Most of that real estate is going up in Mississippi’s Marshall and DeSoto counties.

RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 124 481 17,865
MORTGAGES 127 530 20,565
FORECLOSURE NOTICES 4 48 2,693
BUILDING PERMITS 195 891 36,836
BANKRUPTCIES 52 262 11,426
BUSINESS LICENSES 24 139 5,848
UTILITY CONNECTIONS 26 116 6,830
MARRIAGE LICENSES 26 133 4,049