Development Project Meets Future Mission Needs
September 14, 2011
REDSTONE ARSENAL, Ala.--It takes a business team bullish on the economy to build a 468-acre office and support services complex.
While the declining economy has forced many communities to cut down on expenses associated with business development, Redstone Arsenal and Huntsville are getting ready to welcome the opening of the first of more than 55 office buildings that are part of a 4.6-million-square-foot office complex near Gate 9 known as Redstone Gateway. The value of the complex, once it is complete in 15 years, is estimated at $1 billion.
The area's economic indicators made the Arsenal site an ideal location for the largest ever development for a government-business enterprise known as the enhanced use lease project. Among those indicators is one that has been a favorite with the local community for quite some time -- the 2005 Base Realignment and Closure Act.
"BRAC is one of the aspects of this growing community," said Craig Northridge, project manager for the Garrison's Directorate of Public Works and the EUL project manager. "It's why the Army offered to do this enhanced use lease. We saw a need that had potential. But this is not to say the development only happened because of BRAC. This development also helps with other regional growth and community growth, and with growth at the Arsenal not related to BRAC."
For the Gateway's developer -- Corporate Office Properties Trust -- the communities surrounding Redstone Arsenal have long been a target for business opportunities.
"A lot of this is BRAC driven," Greg Hall, COPT's project executive for Redstone Gateway, said. "Our business strategy is to be located next to growing installations like the Arsenal. That's really our business model. BRAC helped with that."
A year ago, the team involved in the project -- the Army, Huntsville, Madison County and COPT -- had a groundbreaking ceremony to signify the beginning of work on 180 acres in the northern one-third of the 468-acre site west of Rideout Road. Brasfield & Gorrie won bids to oversee both the infrastructure (with the city) and building construction (with COPT). So far, six major contracts totaling $26 million have been let by the city and two more are pending, all in relation to the site's infrastructure. Of that $26 million, $13.5 million in infrastructure improvements directly impact the Arsenal and its employees.
Earth moving and road work began in the early spring, and has progressed to include building construction, and the initial work to move electrical lines, the electrical substation and the railhead now on the site.
While the Army offered the land for the development under a 50-year lease, the City of Huntsville issued a Tax Increment Finance Bond to pay for the work needed to install the site's infrastructure, and Madison County has supported the infrastructure project with tax reimbursements.
"The infrastructure part of the project refers to the horizontal construction that includes earth movement, roads, utilities, sewer and everything needed to get the site ready for vertical (building) construction," Northridge said.
The Tax Increment Finance Bond, popularly known as a TIF, was purchased by COPT. As the TIF area's property values increase, COPT will be reimbursed through the increased generation in property taxes.
"Our goal is to be the leader in public infrastructure," Shane Davis, the director of engineering for the City of Huntsville, said. "This development will be open to the public, and we want to be part of the team to design and install the best infrastructure possible."
Besides its engineering department, the city's traffic engineering, planning, inspection and zoning departments are all involved with the project.
"In the grand scheme, this is one of the largest projects that we've had in the last decade," Davis said. "This project is very important to the city. This is like a Cummings Research Park number 2. Success breeds success, and that's what we're driving for."
For drivers who pass the development near Gate 9 on their way to and from the Arsenal, dirt work and construction is now giving way to the development's first building -- a cornerstone so to speak -- in the northern section of the Gateway.
"I'm very excited by the development," Hall said. "It's nice to plan a project and then see it being built. It is always amazing to see what has been accomplished.
"The goal is to get the first building complete by the end of the year and the infrastructure in place to support that building. We are on schedule to do that."
But that first building represents more than the first of 48 buildings on the western side of Rideout Road and 11 buildings on the eastern side. It also represents "a lot of decisions that have had to be made" by a company whose slogan is "Advancing the Missions of Redstone Arsenal," Hall said.
"The biggest challenge of any project is when all the decisions have to be made. Now is the time to get it right," he said. "We've got a good team in place, a lot of professionals at all levels who know how to make decisions about things like utilities, roads and entrances. These decisions will affect everything about the project."
The first building -- Building 1000 -- is part of a three-building complex. Once completed, construction will begin on Building 1200, which will be a mirror image of Building 1000. The construction timeline on the second building will be determined by customer demand.
"These buildings are going to set the stage for the Gateway. They will be the first buildings you will see forever coming in to the complex," Hall said.
Centered around a courtyard, each of the three buildings will be five stories and will include 120,000 square feet. They will be state-of-the-art in both appearance and purpose.
"Our goal here is to raise the bar in Huntsville as far as multi-tenant office space is concerned," Hall said. "We want to offer high quality space that is attractive to tenants. We are building a very desirable community that is integrated with support services."
COPT management especially enjoys working with small tenants that have the potential to grow their footprint within the complex.
"We are known for providing space for multiple small tenants in one building," Hall said. "Hopefully, those tenants will grow to larger tenants over time, and we will have the space and amenities to accommodate that growth."
Initially, those smaller tenants may only need 5,000 square feet of space or a single floor in a building.
"We want to meet their needs so they are successful. We have the capability to grow with them," Hall said.
The second cornerstone for the development will be Building 7200, a 60,000-square-foot single story, flexible office building in the southwestern section of the one-third of the site under development. The building will be able to accommodate administrative, warehousing and manufacturing needs. It is estimated that in this area of the Gateway 90 percent of space will be used for office space while 10 percent will have other uses.
The third cornerstone will be Building 1600, a 43,000-square-foot project that includes one main building and two out parcels for support services. It is located in the southeastern section of the one-third of the site under development.
"We want to have an integrated park that offers the convenience of support services to tenants," Hall said.
While the support services area will include office supply businesses, restaurants for employees, and, eventually, hotels for business guests and conferences, it will not provide the full shopping experience of Bridge Street, its neighbor to the north.
"The idea is to keep people in the park with all the support services they need," Hall said.
While the dates for building construction are not yet solidified, several infrastructure improvements are set for the spring or summer of 2012. They include relocation of the electrical substation at a cost of $11.1 million and the railhead for $900,000, the rerouting of Goss Road for $2.5 million and the construction of Rideout Road interchange improvements for $2.5 million. As part of that, the electrical substation, which provides power to all of NASA at Redstone, will be new and will be upgraded from 50 megawatts to 80 megawatts, allowing for more growth.
"The existing substation is old. It has become obsolete," Jerry Robinson, electrical engineer for the Garrison's base operations, said. "From this, we will get a state-of-the-art substation with higher capacity. It will improve our reliability and our reaction time."
As the completion of the Gateway's first building nears, Hall said work is being done to secure the development's first tenants.
"We have quite a bit of activity, but no formal commitments yet," he said. "But we are confident because we provide a product that people want and need. This is what we do. The tenants we attract here are probably our tenants in other locations. We are committed to Huntsville and Redstone Arsenal, and we are excited to be able to meet the current and future needs of the installation with this development."
As the Gateway's tenant list grows, there could be changes in the development's plans.
"We do have a master plan, but it is a living document," Hall said. "It's going to change over time. We do know our plan, but we also have to be flexible to meet the demands of the future."