SIZE UP: Springfield Sign owner and CEO Mark Wessell is nearly quadrupling his company’s space with the purchase of the former Polar Tank Trailer plant.
SBJ photo by WES HAMILTON
Polar Tank vacancy doesn’t last long
Polar Tank Trailer LLC’s fourth-quarter exit of its Partnership Industrial Center plant marked the largest commercial move in Xceligent’s most recent Market Trends report. But the vacancy didn’t last long.
Springfield Sign & Graphics Inc., which does business as Springfield Sign, plans to fully move in to the shuttered plant by Feb. 1, said Michal Moss Early, the company’s marketing director.
Mark Wessell, owner and CEO of Springfield Sign, bought the 140,000-square-foot building at 4825 E. Kearney St. from Polar for undisclosed terms Dec. 30 via M&L Real Estate Holdings LLC. He said the purchase price was close to but less than the building’s 2016 taxable appraised value of $7.1 million, according to Greene County assessor records.
The move nearly quadruples Springfield Sign’s space, Early said.
“We needed more space to shorten timelines,” she said. “Obviously, we want to do more business.”
Wessell said the move also consolidates work in three buildings, two of which were at its previous headquarters, 2531 N. Patterson Ave., and another in Rogersville. He’s now marketing the excess properties for lease.
The Springfield Sign executive also pointed to PIC’s qualification for Springfield’s enhanced enterprise zone that allows companies to receive property tax abatement on 50 percent of new investments for 10 years.
Springfield Sign spent roughly $500,000 on plant floor upgrades and another nearly $100,000 on office renovations, with construction work handled by staff.
“In the sign industry, we’re pretty decent in the construction field,” Wessell said. “We’ve done our own contracting with respect to new carpet, new lighting, painting, that type of stuff.”
Early said the move is being made in conjunction with the company’s name change to Springfield Sign from Springfield Sign & Neon. The company has hired a few staff members in anticipation of the move and officials expect to add more as needed.
Polar Tank announced last April it would lay off 245 employees when it closed the PIC plant. Minnetonka, Minn.-based Polar had operated in Springfield since 1995.
While the Xceligent report showed a declining industrial landscape in the Springfield area, it didn’t paint the full picture, local officials say.
According to the report, the fourth-quarter vacancy rate in the sector rose a full percentage point to 4.7 percent. During the quarter, Polar Tank was the leader among some 378,000 square feet in large, negative vacancy changes, according to Xceligent.
Other large moves recorded were Kraft Heinz Co. (Nasdaq: KHC) vacating 125,000 square feet in Springfield Underground and Buckhorn Inc. leaving nearly 107,000 square feet at the former Solo Cup building owned by Warren Davis Properties.
But like Polar, those vacancies didn’t last.
Patrick Harrington, co-owner of Davis Properties, said Ohio-based plastic packaging systems manufacturer Buckhorn had 120,000 square feet under lease at the 1100 N. Glenstone Ave. building, about 107,000 of which was in use. The company had operated in the building since September 2013.
He said with Buckhorn’s third-quarter lease of a 70,000-square-foot speculative warehouse at 4525 E. Mustard Way, as well as its space inside PIC, it no longer needed the space at the old Solo Cup building.
“We actually re-leased that right around the first of the year,” Harrington said, noting the action was days late of making Xceligent’s fourth-quarter report.
NewStream Enterprises, a division of SRC Holdings Corp., signed on for Buckhorn’s 120,000 square feet, Harrington said, in addition to the 230,000 square feet it already leases at Davis Properties’ Glenstone Avenue building. The asking price at the industrial property is $4.25-$4.75 per square foot.
The story at Springfield Underground is similar with a twist.
Springfield Underground President and CEO Louis Griesemer said Kraft vacated 125,000 square feet in the fourth quarter – only to almost immediately reverse that decision.
“What happened is they let that lease expire and vacated the building. It wasn’t very long after we listed the building that they came back,” he said.
A Kraft Heinz official did not respond by deadline.
Griesemer said with 1 million square feet leased, Kraft Heinz is Springfield Underground’s largest tenant. Currently, the underground center has 2.5 million square feet and only about 25,000 square feet available for lease. Griesemer said another 200,000 square feet being carved out should be ready for lease this fall.
Retail and office
Retail dipped a tenth of a point to 4.9 percent compared with the same time in 2015, while office vacancies increased to 8 percent from 7.6 percent.
In retail – which spans nearly 17 million square feet of inventory in the market – the largest movement was Remington’s vacating 30,000 square feet at 1655 W. Republic Road. Owner Ridgecrest Baptist Church announced the closure of Remington’s in late 2015.
In the 6.6 million-square-foot office sector, Andy’s Frozen Custard dominated.
The company is occupying roughly 30,000 square feet downtown with a headquarters move on Water Street.