Insider Only News Commercial Real Estate

Developers rush to build New Castle County warehousing

April 29, 2021 |By Jacob Owens

Dart Container First State Logistics Park Delaware City| — The Delaware City Logistics Park was one of the first major distribution centers to break ground in recent years. It’s now on its final build-out phase

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The Delaware City Logistics Park was one of the first major distribution centers to break ground in recent years. It’s now on its final build-out phase, with Amazon, Newacme and Dart Container already leasing. | DBT PHOTO BY JACOB OWENS[/caption] As available warehouse space in New Castle County is virtually leased as soon as it is finished, or often well before dirt is even turned, major developers are now planning a number of new projects. The rush of new buildings comes as a record amount of industrial growth has hit northern Delaware in the past year, spurred most often by e-commerce giant Amazon, which has leased more square footage in the state than the total space in Wilmington’s central business district. Lisa DeNight, regional research manager at the commercial brokerage Newmark, noted that while Amazon has driven a huge rush of building in the county, other companies like Dart Container and Newacme came looking for space too. “I think we need new buildings to come out of the ground, because there's clearly demand, even outside of Amazon,” she said.

Dermody Properties, the developer of the enormous Amazon distribution center at the former GM Boxwood plant, is now eyeing a smaller project in Middletown, currently called “Project Brynn.” Dermody has submitted plans to the town to build a 181,000-square-foot distribution/employment center at 929 Middletown-Warwick Road. The nearly 52-acre parcel borders around the existing 301 Travel Plaza and is a short distance from the on-ramp to the U.S. Route 301 bypass. According to plans submitted to the state’s planning process, the new facility would feature at least 1,470 parking spaces and a loading area for trucks and vans. It would generate more than 1,700 vehicle trips daily, which includes a vehicle entering or exiting the property, but less than 3% of that traffic would reportedly be tractor-trailers. The land is owned by farmer Richard P. Money, who owns much of the farmland bordering the southwestern edge of the town. He has spent the last few years successfully petitioning annexation of parcels into the town to tap into the infrastructure necessary to develop them. Jeff Zygler, the Dermody partner leading the Boxwood and Middletown projects, told the Delaware Business Times that he couldn’t yet comment on the new project, but added that the firm is “excited to continue our investment in Delaware.” “The state, county and local jurisdictions have been great to work with and we look forward to completing several more projects in the state,” he said. Meanwhile in the Bear area, Stoltz Real Estate Partners has filed plans to construct a second mega warehouse at the former Blue Diamond Park site near the intersection of U.S. Route 13 and Hamburg Road. Stoltz began building a 1 million-square-foot warehouse at the site owned by the real estate arm of Greggo & Ferrara last year. That building is due to open later this year, and Amazon has already leased it for use as a bulk-item fulfillment center. The Pennsylvania-based development firm is now planning a second warehouse to the east of the first, measuring more than 934,000 square feet and featuring 180 dock spaces and more than 450 car spaces. To the south of the Stoltz site, NorthPoint Development is planning the final phase of its Delaware City Logistics Park, which already features more than 2 million square feet of warehouse space leased by Dart Container, Amazon and Newacme in the past year. The last building to be constructed in the northeast corner of the former Akzo Nobel site is a more than 200,000-square-foot warehouse featuring 133 parking spaces. To the west, the D2 Organization is developing an aborted W. L. Gore tract into more than 1 million square feet of distribution or industrial space in the Glasgow area. The project, called Glasgow Commons, is sited at 149 acres near the intersection of Old Cooch’s Bridge Road and Route 896 near Glasgow High School and the Four Seasons shopping center. The plans are working their way through the county’s planning and permitting process, but cleared a major hurdle with the Historic Review Board in recent weeks. D2 proposes to invest $92 million into the development of more than 1 million square feet of offices, manufacturing, and warehousing split over three buildings. Like Glasgow Commons, another major developer is eyeing an industrial park of more than 1.8 million total square feet north of Middletown near the Whitehall community that is currently under development. The Schell Brothers-owned Ocean Atlantic Companies has recently returned to plans to build a four-building industrial park named the Scott’s Run Commerce Center near the U.S. Route 301 bypass access ramp off Jamison Corner Road. The largest of the proposed warehouses would measure more than 750,000 square feet. OA Companies had estimated that the project could cost $360 million when it was first announced more than five years ago. According to county filings, the developer is now targeting a completion of 2023.