So far in 2022, several economic agreements, ground breakings and property acquisitions have already occurred. Georgetown Director of Economic Development Michaela Dollar said the city has close to 6.5 million square feet of industrial or flex space under construction.
“Prior to COVID-19, there wasn’t a big demand for spec development,” Dollar said. “Now with more than seven contracts underway, Georgetown is earning recognition from developers and industrial proprietors nationwide.”
However, Dollar said the adding of more speculative development, which is a project built without any leased tenants, is one of four goals identified in the 2018 Georgetown Economic Development Strategic Plan.
“Having these companies settle in Georgetown will help boost our local economy, drive our real estate market and diversify our labor shed,” she said.
Attracting industrial space
In November 2020, Titan Development broke ground on Georgetown’s first master-planned speculative industrial site called NorthPark35 on 146 acres. The first phase of the project, two Class A buildings totaling 330,000 square feet, has been completed, and the second phase, two additional buildings offering 469,736 square feet of speculative space, will be finished in 2022.
Titan Development’s success, the region’s growth along its major corridors outside urban areas and Tesla’s April 7 opening of its Gigafactory southeast of Austin was really the “linchpin” for Georgetown, Dollar said.
“Because of this big move and the growing demand for distribution centers and production manufacturing closer to population centers, speculative development really took off in Georgetown,” Dollar said.
As of early 2022, Round Rock has 176,534 square feet of industrial space under construction while Georgetown has 1,716,628 square feet under construction in the same time frame, according to data from commercial real estate firm CBRE. Additionally, CBRE data shows out of the 57,948,513 total rentable area in the Austin metro as of early 2022, Georgetown has 2,490,630 square feet of that total, or 4.3%.
“With limited land availability in North Austin and Round Rock, developers started to look more into Georgetown,” Dollar said.
One after another
Titan Development broke ground on its second spec project, Gateway35 Commerce Center, in February.
“Titan’s NorthPark35 & Gateway35 location at the intersection of two major highways is a perfect spot for manufacturers and distribution companies looking to reach anywhere in the Austin metro and beyond,” said Joe Iannacone, Titan senior vice president, in an interview with Community Impact Newspaper.
Slightly smaller than its sister property, Gateway35 is a 114-acre, two-phase industrial park slated for completion by June.
The first phase of Gateway35 will include a Class A, 294,297-square-foot space, which will be leased by CelLink Corp., an electronics technology company that makes wiring systems for electric vehicles and battery packs.
Dollar said CelLink is expected to bring an estimated $130 million investment into the area and about 2,000 jobs, potentially ranking it as Georgetown’s largest private employer.
On Feb. 22, the Georgetown Economic Development Corp. entered into a two-part incentive agreement with CelLink totaling $3,025,000.
Williamson County Commissioners also struck a deal with the developers: Titan Gateway35 will receive a 50% tax abatement on the value of the land and CelLink’s building, while CelLink will receive a 75% tax abatement for personal property, which includes furniture, fixtures and equipment.
The city of Georgetown unanimously approved a similar tax break—50% on land, 75% on business property—estimated to total nearly $2.2 million over 10 years.
The county’s agreement stipulates that CelLink will provide internships and employment opportunities for students in Georgetown ISD.
“We’re not abating 100% of the tax,” Precinct 3 Commissioner Valerie Covey said previously. “The fact that they are coming here and will be paying taxes will benefit us more than if they didn’t come at all.”
The second phase of the park will have two more industrial facilities totaling 420,380 square feet.
Since beginning construction on NorthPark35 and Gateway35, Titan has leased space to CelLink, Amazon, Texas Speed & Performance, GAMA, Schunk Xycarb and Aeronet Logistics.
Also developing in the area is Jackson-Shaw Real Estate Group, a national real estate development company headquartered in Dallas. It closed on 224 acres located west of I-35, north of Hwy. 195 and south of CR 143 in February.
The company will develop the property into the CrossPoint Business District, which council approved for a tax increment reinvestment zone, or TIRZ. This TIRZ allows for new taxes to be reinvested in the site.
Phase 1 is on 61.7 acres and will have three buildings totaling 488,000 square feet. Additional phases on the remaining 162.3 acres are projected to have a combination of industrial, commercial and multifamily developments.
“We foresee a record year for commercial real estate investment, particularly for sought-after industrial and multifamily assets,” said Grant Pearson, vice president of development at Jackson-Shaw, in February. “CrossPoint Business District is an excellent example where the city of Georgetown has remained steadfast in its focus on expanding employment opportunities while preparing for the strategic growth that everyone knows will come.”
Onx Homes, a modular home manufacturer based in Florida, signed a lease for Building 1 of Phase 1 for a total of 204,000 square feet.
“We are excited to partner with Jackson-Shaw to not only bring a quality business like Onx Homes to our northern quadrant but also to complete a major infrastructure project that will pave the way for development in this area,” Georgetown Mayor Josh Schroeder said in a release.
In mid-April, Jackson-Shaw broke ground on Phase 1, which is slated to be finished in summer 2023.
On the south side of the city at 1310 Blue Ridge Drive, Stonemont Financial Group announced March 24 it acquired an 18-acre site for the development of Westinghouse35, another speculative industrial space, totaling 230,000 square feet.
“With the industrial landscape of Central Texas growing at an accelerated rate, it was a natural decision to plant our flag in the region and utilize our spec development expertise to help address the needs of the market,” Stonemont CEO and Managing Principal Zack Markwell said.
The latest to file for a building permit is Portman Development for a parcel of land inside Longhorn Junction, 110 SW Inner Loop, Georgetown, for the annexation of 46.97 acres.
According to permit files, the project started April 15 and will have about 450,000 square feet of speculative space.
Dollar said another developer, Molto Properties, bought 43 acres in Longhorn Junction and will build 604,054 square feet of spec space.
“Between Molto and Portman, it could be just over 1 million square feet total,” Dollar said.
Domino effect
Dollar said Longhorn Junction is Georgetown’s largest tract of undeveloped land along I-35. The plan includes 10 tracts of land varying from 4-70 acres.
With Portman and Molto’s site plans being reviewed, there are only two tracts left. Site work will begin in mid-2022, and other users include a charter school, a regional brewery with a restaurant and music venue, a hotel and 1 million square feet of Class A industrial space, HRE Senior Vice President Steve Madura said.
“In the next few years, we estimate this development to bring over 1,000 quality jobs to Georgetown,” he said.
Dollar said more developments and expansions are coming now that the city knows what developers and the market are interested in.
“The ball is officially rolling,” Dollar said.
