Industrial park in Howard sold for $100 million


In one of the biggest sales of industrial land ever in the Baltimore region, the Gateway Commerce Center in Columbia was sold Thursday for $100 million to a Dallas-based real estate manager for pension funds.

The industrial park, near Interstate 95 at Snowden River Parkway and Robert Fulton Drive, houses the distribution operations of tenants such as Sears, Roebuck and Co., Giant Food Inc. and Jack and Jill Ice Cream.

The warehouse center had once been a General Electric Co. appliance manufacturing plant and was later sold back to the Rouse Co., which redeveloped a portion of the 1,000-acre site as the Snowden Square shopping center and another section as the Gateway Office Park. Rouse had sold three of the huge, 60-foot-high warehouses in two separate sales to the Pritzker family, of Hyatt Hotel Corp. fame, through a representative, Penrose Group Inc. of Vienna, Va.

This week, the Pritzker/Penrose owners sold the three warehouses - totaling 2 million square feet - to Invesco Real Estate, a manager of $19 billion in real estate for pension funds and a division of Atlanta-based Invesco Institutional, which manages $120 billion in assets in North America.

Bill Hensel, a spokesman for Invesco, said the company never comments on its real estate purchases. Invesco Real Estate buys property on behalf of its clients, large public or corporate pension funds or plans, Hensel said.

Olav B. Kollevoll Jr., general counsel for Penrose, did not return calls Thursday.

Richard W. Story, chief executive officer of Howard County's Economic Development Authority, said he wouldn't anticipate any significant changes at the warehouse park.

"These properties ... are tremendous assets," he said. "These are assets with long-term leases and good tenants."

The investment by Invesco, plus a recent announcement that Dreyer's Grand Ice Cream Holdings Inc. will invest $180 million to expand its Laurel ice cream plant, shows Howard County's strength as a place for investment, Story said.

"Some of the bigger deals are occurring here," Story said. "We are centrally located between Baltimore and Washington, and by many definitions we are part of both regions," a plus for companies that want a central spot in the nation's fourth-largest consumer market.

The Gateway Commerce Center got its start in 1970 when GE, on 1,000 acres it purchased from Rouse, began construction on what was planned to be a 12,000-employee plant with eight buildings for manufacturing ranges, refrigerators and air conditioners.

GE built four warehouses and reached a peak employment of 2,800 before scaling back production, in part because of a corporate decision to manufacture appliances in Louisville, Ky. GE sold half the property back to Rouse in 1984 for the office park and sold one warehouse to Luskin's, which was later sold to Preferred Real Estate Investments and converted to office space.

GE later sold the three remaining warehouses to Rouse, which leased distribution space to Sears. Sears is the biggest tenant, leasing more than 1 million square feet.

Rouse began redeveloping the property, first building the Snowden Square shopping center, Columbia's first big-box retail project, in the mid-1980s. It then began developing the Columbia Gateway office park.

In 1996, Rouse sold a 587,000-square-foot warehouse and 15 adjacent acres to the Chicago-based Pritzkers for $16 million. In 1998, Rouse sold two more warehouses to Penrose, the Pritzkers' representative, for $36 million.

David P. Scheffenacker, president of Preston Partners, the broker representing Penrose on yesterday's sale, said the purchase price tops that of any industrial sale in recent memory.

"To the best of my knowledge, this is the largest industrial portfolio sale ever in our market," he said.

An article in the Business section Dec. 25 reported an incorrect time frame for the opening of the Snowden Square shopping center in Columbia. The center opened in 1993. The Sun regrets the error.
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