Developer plans second industrial building to maximize Walker site

Media Mention

By Kate Klemp April 19, 2023

Originally Published in Crain’s Grand Rapids Business

by Kate Carlson

WALKER — A West Michigan industrial property developer seeks to tack on a 45,000-square-foot building to an ongoing construction project in Walker as regional industrial vacancy rates remain low.

Ada-based Honeycrisp Ventures LLC plans to build the additional facility next to a 198,000-square-foot industrial project that’s under construction at 3101 Fruit Ridge Ave. NW. The extra space would accommodate growth plans for an as-yet undisclosed tenant. The larger structure, which should be completed in July, will support an expansion by automation systems manufacturer Specialty Tooling Systems Inc.

The Walker Planning Commission will consider a site plan at its meeting tonight for the additional building, which would include a truck dock and 12-space parking lot on the 32-acre property.

The initial build out on the larger building was quasi-speculative, and Specialty Tooling Systems — which will occupy the entire 198,000-square-foot building — sought to scale up quickly, said Honeycrisp owner Ben Sietsema.

Honeycrisp originally planned for trailer parking spaces on the property, though Specialty Tooling Systems didn’t need the space, leading to plans for an additional building, Sietsema said. Sietsema is in discussions with a potential tenant for the second structure, which he said “would not be a speculative build.”

“This would meet a tenant’s needs. In order for us to really continue and solidify those conversations, we need to be assured that we can get this site plan approval,” Sietsema said. “We now have a little extra land so we decided to try to maximize the site.”

Wolverine Building Group is constructing the main building and would be the general contractor for the additional structure if the site plan is approved, Sietsema said.

Honeycrisp is making full use of the Fruit Ridge property as the West Michigan industrial real estate vacancy rate sits at 2.9 percent, slightly higher than the 2.6 percent average vacancy rate for industrial property in northwest Grand Rapids, according to the JLL West Michigan Q1 Industrial Insight report.

“The West Michigan market remains tight, and demand for Class A warehouse (space) is strong,” according to the industry report.

Sietsema said he is sensing “less velocity” and perhaps fewer executives pursuing industrial space than in the recent past because of economic pressures such as high interest rates. However,  the companies now seeking out properties are more serious, he said.

“What’s driving companies looking for space right now are factors that are serious enough that they need to get deals done,” Sietsema said. “People aren’t just looking for space right now to kick the tires — there is real demand behind companies looking for more industrial space.”

Honeycrisp is among the West Michigan developers chipping away at the region’s high demand for industrial space.

The company last year completed a similar industrial project nearby at 3501 Fruit Ridge Ave. NW. The company also received site plan approval on Feb. 14 to construct a 150,000-square-foot industrial building at 1070 North Gateway Blvd. in Norton Shores. Honeycrisp has since received interest from “another active prospect” seeking to be a tenant at the Norton Shores space, Sietsema said.

As well, Honeycrisp closed on a 45-acre agricultural site in Zeeland that will be converted into nearly 1 million square feet of industrial space. The company has “two active proposals” that would help launch the Zeeland project, Sietsema said.