Irwin: “Ultimately, companies want space that suits their needs, and new, state-of-the-art product is going to be best for their productivity and bottom line.”
SAN DIEGO—With the current high demand for industrial product and low vacancy rates, now is the right time to build, Murphy Development’s Andy Irwin tells GlobeSt.com in this look at the company’s aggressive San Diego development plans.
SAN DIEGO—With the current high demand for industrial product and low vacancy rates, now is the right time to build, Murphy Development’s SVP and director of marketing Andy Irwin tells GlobeSt.com. The firm has adopted an aggressive industrial development plan in San Diego—a market, like many in Southern California, in which industrial space is scarce.
Murphy is nearing completion of its 2.1-million square-foot Siempre Viva Business Park in Otay Mesa with the recent groundbreaking of the 79,050-square-foot Building 17, located at 8500 Kerns St. The $11.9-million structure, will feature 28-foot clear height, 2,000 amps of 277/480-volt power, manufacturing sewer and water capacity, ESFR sprinklers, concrete truck courts, wide column spacing and high dock-door ratios designed for distribution users. Building 17 is estimated to be finished in second quarter of 2017, and Irwin anticipates that the building will be fully leased prior to completion. SVBP is home to a lineup of Fortune 500 companies, including General Dynamics, FedEx, Tyson, Bose and Iron Mountain.
Building 18, the penultimate project at SVBP, was recently finished. The 121,970-square-foot building, located at 2600 Melksee St., was also completed on a speculative basis.
Murphy is also under way on its next class-A industrial park, the Brown Field Technology Park, which will consist of 1 million square feet of new industrial buildings. Plans are currently being processed for the first building in the project, and construction will begin there in the spring, delivering the first building in the fall of 2017. BFTP will feature wide corporate setbacks, mature landscaping and buildings that provide tenants with best-in-class features and functional design, according to Irwin.
In addition to Murphy’s Otay Mesa projects, plans are being processed for the company’s first building at its Scripps Ranch Technology Park. The 244,000-square-foot R&D building is slated for delivery in early 2018. Located less than a half mile from the I-15 freeway in the geographic center of San Diego, SRTP offers many outdoor amenities including tree-shaded trails, Miramar Lake, open meeting spaces and a sports field. Murphy plans to build up to 1 million square feet of R&D, corporate headquarters and office buildings at the project.
We spoke with Irwin about the firm’s aggressive plans and the outlook for industrial development in the current economy.
GlobeSt.com: These are very aggressive plans—any reason for the strong push of activity?
Irwin: With the current high demand for industrial product, and low vacancy rates, we feel it is the right time to build. Our product is state-of-the-art, and we can deliver users the best product in the market. Murphy Development has always been dedicated to building high-quality industrial and technology business parks, with a focus on attracting top-tier tenants. There is very little supply currently available in the market, there are just a hand full of industrial buildings under construction, and there is a scarcity of land available for future development.
Building 18 at Siempre Viva Business Park was recently completed on a spec basis.
GlobeSt.com: Obviously, the runway for industrial is long, but the challenge is finding available land to develop this type of space. Is redevelopment the best option?
Irwin: There is very little industrial land left in San Diego, and most of the land is unentitled. Developers are running into a burdensome entitlement process that takes four to eight years to navigate before you are able to construct a building.
Some developers are renovating older buildings and adding modern features like ESFR sprinklers, heavy electricity for manufacturing, additional loading doors and basic structural upgrades. While a few of the tenants’ basic needs are met, most of the buildings remain very inefficient. Older-generation buildings are characterized by low clear heights, small truck courts, limited loading doors, shallow column spacing and thin warehouse floors. Other developers are reconfiguring older industrial product into “creative office” and lab space, thereby removing these buildings from the inventory of traditional industrial space. Murphy Development has always positioned itself to have the land available to build new buildings, and that is what we are doing now. In addition to the 80,000-square-foot building currently under construction, Murphy has 81 acres of entitled land ready for development. Ultimately, companies want space that suits their needs, and new, state-of-the-art product is going to be best for their productivity and bottom line.
Building 17 at Siempre Viva Business Park is estimated to be finished in second quarter of 2017, and Irwin anticipates that the building will be fully leased prior to completion.
GlobeSt.com: What else should our readers know about your upcoming plans?
Irwin: Our Scripps Ranch Technology Park project is a lot more than the development of a single R&D building. Formerly planned for Intel Corp.’s 1-million-square-foot campus, SRTP is a 55-acre corporate campus with five fully entitled, development-ready lots on 31 acres. The other 24 acres are set aside within the campus for outdoor open space, trails and a sports field. We have designed the campus with two- and three-story buildings with large floorplates for office, engineering and R&D tenants. Floor-plate sizes range from 30,000 square feet to 120,000 square feet. The proposed buildings are for lease or sale and range from 60,000 square feet to 240,000 square feet. The campus is located in San Diego’s mid-city neighborhood Scripps Ranch, a half mile from the I-15 Carroll Canyon diamond interchange.
MDC calls its corporate campus “one of one,” a powerful magnet for a company to attract and retain the best and brightest employees. Creating pedestrian friendly courtyards, promenades, jogging and mountain biking trails and open spaces allow the buildings to connect to a network of outdoor amenity areas. In addition to the proposed café and bistro, MDC has planned for an organic garden, event lawns, collaboration terraces, a parcourse, an indoor-outdoor fitness center and an amphitheater for gatherings.
The buildings are designed to respond to the context. The glass facades, upper-level collaborative terraces and lobbies all open up to the outdoor amenities. Believing that productivity is not constrained within walls, we’ve included glass roll-up garage doors that open the interior office space to exterior decks facing the natural eucalyptus grove. The architecture responds to climatic challenges as well. Sustainable solutions include solar-panel energy production, EV charging stations and natural outdoor elements.
SRTP is also an ideal setting for employee wellness. The lunch hour can include a leisurely stroll through the forested paths, miles of mountain biking, navigating Lake Miramar on a kayak, or a pick-up game on the soccer field.
Brown Field Technology Park will consist of 1 million square feet of new, class-A industrial buildlings.
Scripps Ranch Technology Park will begin construction in the second quarter of 2017 with delivery slated for early 2018.
