Stonemont Financial Group, a privately held real estate investment firm specializing in industrial development and net lease assets, announced today that construction has officially finished on phase one of the Georgia International Trade Center (GITC) in Effingham County, Georgia near Savannah. The milestone caps a remarkable 12-month period that saw nearly 2.5 million square feet of new warehouse development, fueled by a large build-to-suit for Shaw Flooring and several third-party logistics (3PL) providers that moved to the park, helping to accelerate plans for the next round of construction on the project’s second phase.
Stonemont also announced that it finalized the sale of a 154,650-square-foot spec warehouse to De Well Group, a global freight-forwarding company based out of Los Angeles. The transaction marks De Well’s entrance to the Savannah market, which will serve as the firm’s Eastern U.S. headquarters. As a leading freight-forwarder for the Asia-North American trade routes, De Well could be a catalyst for more shippers to the Port of Savannah and more space needs at GITC, according to Stonemont.
Other tenants who have recently signed leases at GITC include Sunland Logistics Solutions (150,000 SF), a 3PL provider headquartered in Greenville, South Carolina, and Dukal Corporation (operated by Geodis) (270,000 SF), a leading global supplier of high quality medical disposable products and patient care items for the healthcare market.
GITC is Savannah’s newest rail-served industrial park, located less than ten miles from Georgia Port Authority’s (GPA) Garden City Terminal. The site is fully entitled to accommodate up to 7.2 million square feet of industrial development buildings ranging in size from 155,000 to 1,265,000 square feet, and includes CSX rail service with direct access to the port. According to the GPA, Savannah has a 21% market share on the East Coast and is now the nation’s third largest port behind only New York and Los Angeles-Long Beach.
“The phenomenal pace of absorption we’ve seen in the first phase alone demonstrates a clear and healthy level of demand from 3PL providers and other logistics firms that will continue to accelerate moving forward,” said Zack Markwell, Managing Principal and CEO at Stonemont Financial Group. “The market intelligence and data we were able to glean from our initial build-to-suit engagement with Shaw Flooring played an integral role in the successful development of the speculative buildings that immediately followed and were quickly leased up or sold. Our team’s experience and in-depth understanding of the intangibles essential for success in the logistics arena have enabled us to create a formula that resonates with the market, with GITC poised to capitalize in the years ahead from the ongoing expansion at the Port of Savannah.”
“GITC offers the opportunity for Sunland to grow and create a multi-location effect in the same business park. This position is helpful to our long-term growth strategy as a company,” said Elijah Ray, Chief Customer Officer at Sunland Logistics Solutions. “Stonemont seemed to sense Sunland’s growth potential and demonstrated a strong desire to work with us. They were detailed in their approach to sharing the property specifications while also giving us a glimpse into the future of the park and how we might fit given our strategy.”
Earlier this month, GPA announced it had achieved a significant milestone in the ongoing Mason Mega Rail project, which will double GPA’s existing rail capacity and increase the port’s reach to major markets in the Midwest and Southeast. Nine of 18 working tracks have now started operations, with two rail-mounted gantry cranes to be commissioned later in June. Once complete, the Mason Mega Rail Terminal will be able to handle approximately 2 million twenty-foot equivalent units (TEUs), creating new opportunities for industrial developers and investors.
Shaw Industries Group, Inc. was the first tenant to lease space at the GITC, moving into a 778,050-square-foot warehouse on the property in November of 2019 and another 291,000 square feet at an adjacent building last month. According to CoStar, the 1.06-million-square-foot deal was the second largest industrial lease signed in Georgia in 2019. Incidentally, the largest industrial lease was also a Stonemont project (the 1.5 Million square-foot build-to-suit lease to Goodyear Tires in Newnan, GA).
Stonemont and its development partner Chesterfield LLC took a substantial risk in pursuing the Shaw transaction, as they knew it could be a catalyst for GITC. Before securing the contract with Shaw, the firms chose to start over $3 million of site preparation work that was needed to meet the November delivery date mandated in Shaw’s RFP. General contractor Omega Construction worked on a handshake deal with Stonemont and Chesterfield, making a gamble that the project team would ultimately win the bid with Shaw.
“This is one of those war stories we’ll talk about forever,” said David Burch, Principal with Stonemont. “Obviously it was a big risk, but we knew how much that first build-to-suit could mean for the future of the park, so we took it.” The unique, entrepreneurial approach is indicative of Stonemont’s approach to their business and their ability to build goodwill and inspire confidence among its development partners.
The next phase of construction calls for three buildings of 1.15 million square feet, 416,000 square feet, and 250,000 square feet, respectively. Stonemont has invested more than $150 million to date and is developing the project in conjunction with Chesterfield and The Davis Companies.
