November 25, 2007

Developers Work on Big Warehouses at Local Sites

By Deneen Smith
Kenosha News

A Chicago developer will soon break ground on a massive warehouse on Kenosha's west side, the second 600,000-square-foot industrial building under way in the area.

First Industrial Realty Trust Inc. already completed ground work for the warehouse project on the northeast corner of 52nd Street and 88th Avenue in Kenosha. Construction will start on the building this fall, with work expected to be complete by late 2008.

Rust-Oleum will move its existing distribution center operations from two warehouses in Pleasant Praire into the Kenosha building.

The company decided to seek a new building after Pleasant Prairie rejected its plans to expand an existing warehouse at 9201 Wilmot Road to about 600,000 square feet. The village opposed those plans because the existing warehouse is in a non-industrial area near a school and residential neighborhoods.

Gene Childers, facility manager at Rust-Oleum, said the new warehouse will employ about 75 people.

"We're moving some existing (employees) there, but there will probably be some new growth as well," he said.

Childers said the company wanted to increase efficiency by consolidating its distribution operations in one building.

To build the Kenosha warehouse, First Industrial had to seek special permits from the state of Wisconsin because the products stored there could be a fire hazard. Peter Ginn, a spokesman for First Industrial, said the building needed specialized fire suppression systems to meet state guidelines.

Ginn said the development company had already purchased the 169-acre site it is calling First Park Kenosha with plans to build large distribution center projects before securing the deal with Rust-Oleum.

"We truly believe in the market. It has become an extension of the Chicago market," Ginn said.

He said there are about 12 buildable acres north of the Rust-Oleum site with room for about four buildings of approximately 50,000 square feet each.

The company owns an additional 100 acres adjacent to the Rust-Oleum site that it plans to target for office/warehouse buildings.

"That is what we are envisioning for this market," he said.

Sacramento, Calif.-based Panattoni Development Co. also sees the Kenosha market as a strong draw for distribution center development.

The company purchased the second phase of the Business Park of Kenosha in April and is building a 626,000-square-foot warehouse building on speculation in the park.

The sprawling building, the largest of its kind in Kenosha County, is northeast of 58th Street and 104th Avenue.

John Pagliari, a Chicagobased partner at Panattoni, said the building will likely be complete by the end of the year. The company has not yet signed any tenants, but said there is interest in the project.

"We have a number of people looking at either a portion of the building or the whole building," he said.

Pagliari said Panattoni is planning on building a second structure of about the same size in the park, along with another 100,000-square-foot building and a 140,000-square-foot building.