New place for office space
(11/06/2000)
Jennette Smith - Crain's Detroit Business
Macomb County's reputation as a place for office space is gradually
improving in the eyes of developers and tenants.
A number of recently completed or planned developments show that though communities
such as Sterling Heights, Clinton Township and Warren aren't known as office
hotbeds, demand is growing.
More than 450,000 square feet of office space is either recently completed,
under construction or on the drawing board. That's significant, considering
the small size of the county's existing office base. At land acquisition and
development costs of at least $125 a square foot, as estimated by Barbara
Eaton, vice president at Bingham Farms-based brokerage Colliers International,
the projects could add up to more than $56 million.
The area has seen more interest in offices for a variety of reasons. Population
growth and the expansion of M-59 are two of the strongest.
Mark Singerman, vice president of Novi-based Crosswinds Commercial, said that
as the county's residential and retail base continues to grow, it makes sense
that office space increasingly will become part of the mix.
``You've got to have the whole package,'' he said. ``The shops like to have
the office workers there. The office workers like to have nearby services.''
Crosswinds Commercial and Eastpointe-based The Monahan Co. are partners in
one of the office projects: the Sterling Plaza development near Lakeside Mall.
The first phase of the project, a 31,000-square-foot building off Lakeside
Circle, was leased entirely by Cross Huller, a division of Thyssen Steel.
Sterling Plaza's second phase is under construction. Charles Schwab &
Co. Inc. has signed on as a tenant, and the developers are looking for other
tenants to fill the second 31,000-square-foot building. Colliers is marketing
Sterling Plaza.
Singerman said he expects to see more automotive or engineering tenants take
an interest. The development near M-59 is a short drive from the GM Tech Center
in Warren or the DaimlerChrysler AG headquarters in Auburn Hills.
There is space for a third building at Sterling Plaza if demand keeps up,
said Singerman and Michael Monahan, president of The Monahan Co. Monahan's
brother, Vice President John Monahan, is the project manager. The value of
the first two Sterling Plaza buildings will be about $4 million each.
The Monahan Co. has property under contract in Warren at Mound and 12 Mile
roads that could be developed into 200,000 square feet of office, high-tech
and/or retail space.
``We are still attempting to finalize leases with prospective users,'' Michael
Monahan said. He said he hopes to get leases signed and start a Warren project
during the next few months.
Another large project in Macomb County comes from construction company John
Carlo Inc., which completed its 51,000-square-foot, three-story corporate
headquarters. The headquarters is half of a development called Riverbend Executive
Park at M-59 and Romeo Plank Road in Clinton Township. Carlo has occupied
the second and third floors but is leasing out the first floor. So far, brokerage
Merrill Lynch has leased space there, said leasing agent Sam Munaco, associate
broker with Signature Associates-Oncor International, based in Southfield.
Munaco said John Carlo is waiting to line up more tenants before beginning
construction on a second 51,000-square-foot building at the executive park.
Eaton said many of the office tenants interested in Macomb space are service
providers such as stock brokerages, insurance companies and title companies.
They are following the population growth in growing northern communities.
Certain Macomb corridors such as along Van Dyke Avenue and Mound Road offer
opportunities for a blend of office and high-tech space because of proximity
to fiber-optic cables, Eaton said.
Also, there is a market for smaller projects combining medical and office
space close to residential developments; several such projects are planned.
Walter Cueter, president of Cueter Properties Inc., based in Sterling Heights,
plans to include 35,000 square feet of medical and office space in his 50-acre
mixed development off M-59 west of Ryan Road in Sterling Heights.
The project also is to include 58,000 square feet of commercial space and
a 300-unit condominium development.
Cueter said infrastructure improvements such as the recent widening of Ryan
Road and the expansion of nearby Troy Beaumont Hospital helped trigger demand
for the project. He said his project probably would include a mix of doctor's
offices and professional service tenants.
Ken Klaft, owner of Washington Township-based Champion Ventures, is planning
a combination medical and office project in Shelby Township. Klaft plans to
complete 19,000 square feet by February and then plans to add an additional
10,000 square feet. The site is on Lakeside Boulevard North west of Hayes
Road and north of Hall Road.
The Shelby Village Office Center so far includes a commitment from Greco Title
Co. to lease space, and Klaft said other prospective tenants are real estate
firms, dentists, financial planners or insurance agents.
Singerman said Crosswinds' residential arm has a project in Shelby Township
at M-53 and 23 Mile Road that may offer potential office and medical space
as well, but that project is still in early planning.
Jennette Smith: (313) 446-0414, jhsmith@crain.com
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