With Plainfield's industrial real estate market booming, but most of its land spoken for, what's a developer to do? Go west, young man.
That's what Lauth Property Group plans to do. The Indianapolis developer is working to complete the purchase of 550 acres it has under contract at the northeast corner of Interstate 70 and State Road 39, one interchange west of Plainfield.
"In probably two years, Plainfield as we know it will be built out," said Tag Birge, vice president and market officer for Lauth. "This is the next interchange, and a viable industrial interchange, right on I-70."
Birge wouldn't disclose what Lauth is paying for the land. A developer hoping to build a theme park on the property paid $7 million for it in the early 1990s. That project failed, and real estate investors Mark Sanders, Lee Comer and Tim Shrout acquired it for $8.5 million at a bankruptcy auction two years ago.
Lauth said its project, dubbed Westpoint Business Park, ultimately will house 10 buildings with as much as 7.5 million square feet. When it's built out in seven to 10 years, Birge said, Westpoint will rank among the five biggest industrial parks in the Indianapolis area.
Most of the acreage is in Hendricks County, but a small portion on the eastern edge is in Morgan County.
Lauth has been working on the project more than a year. Birge said progress was slowed by discussions over who should pay for sewer improvements. Those issues are resolved, he said, and Lauth is working with the county to arrange tax abatements and a tax-increment financing district.
Hendricks County Commissioner Ed Schrier declined to comment, saying negotiations are continuing.
County commissioners and Lauth signed a nonbinding letter of intent in July under which Lauth would contribute $1.1 million toward sewer costs. Under the plan, the county would issue $3 million in bonds for sewer work, which would be repaid from extra property taxes generated by development in the area.
Bart Book, a principal with the local office of St. Louis-based Colliers Turley Martin Tucker, said companies needing more than 500,000 square feet have taken a serious look at the Lauth plan.
"It just seems a natural market transition as the majority of the ground in Plainfield gets developed," Book said. In 2000, Plainfield had a total of 9.3 million square feet of industrial space; that had jumped to more than 21 million by mid-2006, according to data provided by Colliers Turley Martin Tucker.
The Lauth project could trigger other activity at the exit, which now has little beyond a truck stop, gas station and farmland.
Residential developers also are taking interest. Early this year, CP Morgan Co. Inc. began selling homes in its Homestead development, about one mile south of I-70. The home builder has sold about 10 percent of the planned 966 lots. Base home prices range from $105,000 to $160,000
And a 511-acre parcel just north of the planned Lauth development is on the market, said Gus Miller of NAI Olympia Partners. Miller is representing the owner, the Hall family, which built and operates the Deer Creek Golf Club. The land up for sale surrounds the course.
The family wants to sell the land for home building. The location boasts a relatively easy commute to the airport or downtown–a selling point for industrial development, too.
So far, no buyer has materialized, Miller said, in part because many national home builders are in a retrenching mode.
Hendricks County Commission President David Whicker is glad to see the uptick in activity in the area.
"There's not a whole lot there now with the exception of a truck stop. It's a huge opportunity," he said.