Editor’s Note: Recently, WRAL TechWire launched a new series, the “Future of Work” that showcases the changing nature of the Triangle’s economy, its places, and its spaces. The Future of Work series is supported by commercial real estate firm JLL and other partners. The first report is here, and the second story is here. Last week, the series explored the relationship between work spaces, work places, and the current labor market. WRAL TechWire hosts a LinkedIn Live broadcast on Tuesday, May 3, at 11 a.m.
RALEIGH – In a sleek, 45-minute virtual groundbreaking in September 2020, the RTP Foundation released its plans for Hub RTP, which will sit on 44 acres of land in the heart of the Triangle. That will include a $50 million project known as the “horseshoe.”
“Anything near RTP is extremely liquid and sought-after in recent years, which includes areas of Durham, Cary, and Morrisville, for any product type,” said Sarah Godwin, a senior director of capital markets for JLL.
But it’s not just land in the center of the Triangle that is in high demand. There are other areas that have seen a lot of interest from developers, whether that’s for commercial facilities, multifamily properties, or residential neighborhoods, said Godwin.
“On the eastern side of town, both Raleigh and Garner are very in demand,” said Godwin. “Garner has been interesting, since most interest is residential in nature, but it’s getting looks now for flex and life science.”
When it comes to land across the Triangle region, there’s been an increase in competition that has led to an increase in pricing in recent years. According to Matt Winters, an executive vice president at JLL, while the region used to be dominated by two submarkets, in east Raleigh or along the I-40 corridor near Research Triangle Park, there’s increasing demand in new areas of the region.
That includes the US-1 corridor, which connects Sanford to Apex and then Raleigh to the east, and Greensboro to the north.
VinFast selected a site along the US-1 corridor for its $4 billion automotive assembly and electric battery plant, for example, and multiple biopharmaceutical companies have selected Sanford for facilities in recent years.
There’s also increasing demand along I-40 near Mebane and Burlington, noted Winters, as well as increasing interest in communities like Clayton and Garner, the site of a planned mixed-use development announced last week. Johnston County has been selected for industrial projects, including multiple Amazon facilities, as well.
“There is an insatiable demand for land that can accommodate industrial projects,” said Winters. “In addition to longtime Raleigh stalwarts in industrial development, there is now great diversity of capital searching for industrial land in the Triangle, leading to increased competition and land values.”
Land development isn’t easy
Stare out at a plot of vacant, undeveloped land. What do you see?
A vision of what’s possible also relies on an in-depth understanding of what’s not possible.
As developing land, whether for residential or commercial purposes, is incredibly complex, said Godwin, it can take many years of planning before any dirt is actually moved on the property.
“From the first conceptual layout and product selection, to rezoning and/or site plan approval, to construction drawings and permits, not to mention all of the interim steps for wetland delineation, NCDOT approvals, and 401/404 permitting through the US Corp of Engineers,” said Godwin, “the full process, from raw land to groundbreaking on the first building or home, can take several years.”
The construction that is visible today, said Godwin, “likely started being conceptualized in 2017-2019.”
Developers won’t often receive praise for the vision and the behind-the-scenes work that it takes to bring a project from ideation to reality, said Godwin. But there are many examples of incredible, extraordinary projects that are underway in the Triangle, noted Godwin. That includes developments like Wendell Falls or Chatham Park. Those are great examples, said Godwin, of amazing atmospheres “with a true live-work-play vision from the beginning.”
More than time, land development takes human capital
The site of the planned VinFast facility took thousands and thousands of hours of time to prepare the land for possible selection.
“It takes many, many years,” said Godwin, to prepare a site like Triangle Innovation Point for development. That can include more than a year of time and work before a property is even acquired, said Godwin. And that’s often just the start of the process.
Take Triangle Innovation Point as a case study. It’s been a project more than a decade in the making, said Godwin. “With untold meetings with Chatham County, NCDOT, and other governing bodies.”
Add to the process the other critical groups required for a project at that scale, like wetland consultants, traffic engineers, civil engineers, land planners, utility companies, and more.
Beyond the time investment, these types of projects can be capital intensive, even to prepare them for potential selection. That’s why public money can be needed, said Godwin. “If an upfront investment is needed to make the site investor-ready or to provide regionally beneficial infrastructure,” noted Godwin.
And for projects that seek large tenants—like Toyota or VinFast, for example—who are conducting multi-state searches, land must be prepared to offer competitive “speed to development” to be on par with other shovel-ready sites, said Godwin.
“Each commercial or multifamily development, from idea to completion, likely has hundreds of professionals that help shepherd it to completion,” said Godwin.
This editorial package was produced with funding support from JLL and other partners. WRAL TechWire retains full editorial control of all content.
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