New Endeavor Development to Kick Off 3 Spec Industrial Developments
The new year opened with a new company for commercial real estate veteran Josh Budish. He has launched Edina-based Endeavor Development, a new firm solely dedicated to industrial real estate.
Budish previously worked for some big players: two large national, publicly traded real estate investment trusts (REITs) with a big presence in the Twin Cities market. He was vice president for the local office of Indianapolis-based Duke Realty Corp. for seven years. Budish oversaw Duke’s local portfolio of 5.1 million square feet of industrial space. Before that he was with the local office of Pennsylvania-based Liberty Property Trust for 10 years.
“I felt it was the right time for me personally to make a move,” said Budish. “I felt it was the right time with respect to the market, where I see things currently and where I see them headed.”
Budish has backing from “multiple investment partners.” Endeavor Development already has three development projects teed up to start.
- Pilot Knob Business Center, Mendota Heights: 112,500 square feet
- Highview 610 Business Center, Brooklyn Park: 75,000 square feet
- Yankee Doodle Business Center, Eagan: 75,000 square feet
“We’ll be breaking ground on all three this spring and delivering this fall,” said Budish. “All speculative, all industrial.”
Speculative or “spec” projects are those where a developer starts building a property without any leases in hand. Spec office projects are rare these days, but demand is robust enough in the industrial sector for developers to charge ahead.
There’s good reason to be bullish.
A fourth quarter report on the Minneapolis-St. Paul industrial market from Chicago-based JLL reported the industrial vacancy rate at 6 percent – far lower than seen in office or retail markets. JLL reported absorption of 766,074 square feet of local industrial space for 2020. The growth of e-commerce is likely fueling some of the demand for industrial space.
Dan Larew, vice president with JLL’s local industrial team, said that his team is tracking more than 8 million square feet of current demand for industrial space.
“The demand from both users and investors for industrial real estate was growing quite significantly before Covid-19,” says Budish. “The demand has only accelerated.”
That’s because pandemic conditions have driven just about everyone to buy more things online.
“The number one driver for industrial real estate today is e-commerce,” said Budish.