Industrial developer Fogg readies next building for Summit County business park

Spring has sprung, and Ray Fogg Corporate Properties is readying plans to build another structure, its sixth, at the Seasons Business Park in Stow.

Ray Fogg, president of the Brooklyn Heights building contractor and real estate development firm, said in a phone interview that leasing prospects for the park’s fifth building , finished last year, are strong, so the company is pushing to construct its next building on a speculative basis.

The proposed 254,474-square-foot building will go up on Gray Lane facing State Route 8 at the southwest corner of the state road’s interchange at Seasons Road. The developer received approval for its site plan for the 15-acre parcel at the Stow Planning Commission’s Feb. 8 meeting. The structure will be the second to go up on the west side of Route 8 following its initial phase, with four buildings on the opposite side of the interchange. The park is a joint venture by the Brennan family, which owns the land, and Fogg, which is doing the developing and building.

Just 54,000 square feet is left in the park’s fifth building, Fogg said, and there is interest in that remainder, so the company is readying the next structure.

“Most people will tell you it’s the market of a generation,” Fogg said. “Others will say it’s the market of a lifetime. The forecast is for strong demand to continue for some time. The retooling of the economy with e-commerce and how we do logistics is feeding it. Even the latest worldwide news is pushing greater need to reshore materials, goods and manufacturing here.”

So there is plenty of incentive to continue building, even though the pandemic is making the process more difficult with rising material costs and supply problems.

“There are challenges with every project,” Fogg said, “and supply issues are another challenge to meet.”

To cope with supply problems, he noted his company ordered precast concrete for the next building almost a year ago. In the past, it used to order the precast a few months ahead. He noted that rising building costs are a concern, but may pale compared with the impact of rising interest rates from the record lows of the last two years over the lifetime of a project.

Experts expect Fogg will find substantial demand for the additional space.

David Stecker, a vice president at JLL Inc.’s Cleveland office, said in a phone interview, “From our viewpoint, it’s good to have more inventory on the way. There is lots of spec construction and build-to-suit construction, but not as much space is on the market as we have demand (for). There are also tenants in existing buildings who will look for places to expand.”

JLL estimated vacancy in the southeast suburbs, which include Stow, at 4.9% at the end of 2021 in Summit County. Throughout Northeast Ohio, there is 4.5% vacancy, a decline from last year, even though the region absorbed 5.4 million square feet of industrial space in 2021, a record. About 2.5 million square feet of such new-breed warehouses was finished last year and another 4.2 million square feet of such space was under construction. The industrial market in the region now consists of almost 367 million square feet, JLL reported.

George Pofok, a principal at the Cushman & Wakefield Cresco real estate brokerage in Independence, said even with all the industrial building activity, “It’s not near enough. For tenants in the market, 2022 will be challenging because of the lack of available property.”

Stecker said Fogg’s buildings at Seasons are adaptable, so they can fit tenants who need as much as 250,000 square feet or as little as 50,000 square feet.

The downside of all the action, at least for tenants, is that rents are climbing in the industrial warehouse market. The average asking rent hit $4.99 per square foot as of the end of 2021, JLL said, an increase of 63 cents from the prior year.

The Fogg and Brennan joint venture started developing Seasons Business Park in 2015.