AT Industrial aims to meet demand for e-commerce distribution with new business park on the West Plains

A local real estate company aims to meet the rising demand for online shopping with a new building suited for e-commerce distribution companies on the West Plains.

AT Industrial is planning to build the West McFarlane Business Park near the southeast corner of Russell Street and McFarlane Road, just west of the Spokane International Airport.

The development calls for a 187,000-square-foot industrial facility that could accommodate one to 12 tenants, including small local businesses needing office and warehouse space, and large national manufacturers searching for industrial power and zoning, said Aaron Lake, managing partner of AT Industrial.

The project, which is anticipated to break ground this month and be completed by early next year, has already gained interest from prospective tenants, he said.

“We can help local entrepreneurs, attract manufacturing enterprises to the area, and position Spokane to get a foothold in the e-commerce industry – all in one facility,” Lake said.

The West McFarlane Business Park will allow companies to fulfill “last mile” distribution for online orders by providing double-sided loading in the facility, as well as excess land that can be used for truck and trailer parking, and outside storage.

Trucks can easily drop off goods, which can then be loaded onto vehicles for delivery to customers in Spokane and surrounding cities, such as Yakima and Missoula, Lake said.

The West McFarlane Business Park could not only potentially attract national e-commerce companies in need of distribution facilities in the area, but spur additional business activity on the West Plains, he said.

The business park would be one of the first facilities built in the Airway Heights Opportunity Zone, which was created as part of the federal Tax Cuts and Jobs Act of 2017 to spur economic development through tax incentives.

AT Industrial anticipates leases will be 10% to 15% lower at the West McFarlane Business Park than at other area business parks because it’s able to build the facility at a lower cost as a result of Opportunity Zone tax savings.

Some tenants – especially new businesses and startups – may also qualify for tax incentives by relocating their operations to the Opportunity Zone.

Although many developers paused projects nationwide because of uncertainty surrounding the COVID-19 pandemic, AT Industrial believes Spokane is well-positioned to accommodate e-commerce growth, some of which was spurred by recent stay-at-home orders.

U.S. retailers in mid-April reported a 68% increase in year-over-year online sales, according to data from the COVID-19 Commerce Insight by Emarsys and GoodData.

The e-commerce retail industry generated $187 billion in sales during the fourth quarter of 2019, according to the U.S. Census Bureau.

“Our nation is seeing significant growth in e-commerce sales,” Tim Wolff, co-managing partner of AT Industrial said in a statement. “One of the only ways to meet that surge in demand is for the last-mile distribution industry to grow.”

AT Industrial was launched by Lake, president of Seattle-based real estate services company Leavitt Capital, which has two offices in Spokane, and Wolff, who recently retired from an executive role at local real estate firm The Wolff Co. and remains active on its investment committee.

AT Industrial owns nearly 700,000 square feet of industrial property in the Spokane area, including the recently completed 100,000-square-foot Montgomery Logistics Center at 11002 E. Montgomery Drive in Spokane Valley.