The Salem, Oregon, owners originally bought the land in 2006 thinking it might be a good place to build one day. Then the Great Recession hit in 2008 and the 6.92 acres just sat and sat 120 miles away in Bend, Oregon.
Fast forward to 2018 and Jet Industries, a full-service design-build company, decided it might be time to sell the parcel. Instead, its brokers at Fratzke Commercial Real Estate Advisors suggested the firm consider developing the real estate for light industrial users. After studying the market, Jet Industries went to work.
The timing for what became the High Desert Industrial Park could not have been better. The pandemic hit, putting a premium on warehouse space, and it wasn't long before the new complex set a high-water mark for industrial leasing prices in Bend, reaching $1.25 per square foot, according to the broker team. The success earned the project a 2023 CoStar Impact Award, as judged by real estate professionals familiar with the market.
All told, the project has resulted in 33 separate leases that generate nearly $1.7 million per year in net operating income, the brokers say. At least three other developers, noting the success of High Desert, have now launched their own projects in the region.
About the project: High Desert Industrial Park is a seven-building development totaling over 128,000 rentable square feet. It features high dock bays with south-facing exposure to help melt any snow, as well as suites with 26-foot clear heights and some with roll-up doors allowing drive-through access. Tenants include Fisher Thermo Scientific, Crowdstrike and Crescent Electric.
What the judges said: "The development faced significant challenges dating back to 2008, showing the resiliency of the teams involved. The project included a high degree of thoughtfulness in design and innovation, creating premier industrial space that can handle the environmental realities of Central Oregon. Not only was the space absorbed quickly, but it adds significant inventory in a supply-constrained market," wrote Jamison Shields, a research analyst for Colliers.
They made it happen: Oliver Raab, senior vice president at Jet Industries, managed the development. Steele Associates Architects designed the complex. Principal brokers Brian Fratzke and Tom Tapia of Fratzke Commercial Real Estate Advisors represented the landlord and, in 16 leases, the tenant as well.