Home Depot Snaps Up Sizable Portion Of Under-Construction Weld County Industrial Campus
After inking a 386K SF deal in Weld County, Home Depot has leased more than 30% of the industrial space under construction in northern Colorado.
Home Depot leased space at Access 25 Logistics Park, a 300-acre industrial campus under construction near the intersection of Interstate 25 and Highway 34 in unincorporated Weld County. The project’s developer is Broe Real Estate Group, a division of The Broe Group, a Denver-based company with divisions specializing in investment, energy and railroads, in addition to real estate.
Home Depot will be the lead tenant at the rail-served bulk distribution center. CBRE is handling leasing for the project.
The home improvement retailer joins other household names with distribution centers in the area. In 2020, FedEx broke ground on a 52-acre campus in Mead, and just before that, Amazon opened a distribution center near the Fort Collins-Loveland airport.
Distribution centers are increasingly popular across the country as retailers and e-commerce companies seek to get products closer than ever to their customers, cutting delivery times to the bone. But in northern Colorado, outside the reach of metro Denver’s historical industrial sphere, competition for this kind of space has grown fierce.
Warehouse and distribution uses make up 20M SF of the 34M SF of total industrial inventory in Denver, according to CBRE’s Northern Colorado Industrial Marketview for the first half of 2021. That 20M SF has not proven to be enough to keep up with demand from companies looking to expand in the fast-growing area.
Like most of the country, the industrial market in Weld County and neighboring Larimer County recovered quickly from a sharp drop caused by Covid-19, popping back up and leveling off as online shopping continued to grow in popularity.
Direct average asking lease rates for warehouses hit $10.73 per SF in the first half of 2021, according to CBRE, about a dollar higher than those seen closer to Denver, driven by a 4.2% vacancy rate.
Yet, proximity to a population center remains the biggest draw for developers, which have more than 10M SF of industrial development activity in the pipeline for metro Denver, but just 1.2M SF in northern Colorado.
That 1.2M SF is still far greater than the region's construction pipeline in 2019, when roughly 350K SF was under construction.
Home Depot has pivoted more than once over the course of the pandemic, which initially sent property owners to home-improvement stores in search of tools and supplies for do-it-yourself projects on their homes while they were stuck there. But as the country has slowly normalized, people are once again opting to hire professionals to perform these jobs, causing Home Depot and its competitors to switch gears.
The new Weld County location places Home Depot at the nexus of two roads that connect many of the population centers in Colorado, with bonus access to Cheyenne, Wyoming, just about an hour north. Plus, the immediate area, made up of towns like Loveland and Johnstown, has grown quickly in population with new subdivisions popping up and an expanding retail base.