Hillwood courting more large projects for Cecil; Tatsch says smaller facility not Amazon.com sortation center

  • Government
  • Share

Hillwood Investment Properties dealt with several large prospects during the second quarter, including a 1 million-square-foot distribution center, a 200,000-square-foot e-commerce operation and a speculative building that should start construction by year-end.

No tenants were identified, although the distribution center appears to be Project Velo.

The city introduced legislation last week for incentives to support the 1,200-job deal at Cecil Commerce Center.

In its second-quarter report to the city Wednesday, Hillwood said it began due diligence and design work related to the distribution center on Parcel C, an 86-acre site that fits Project Velo’s details.

Project Velo resembles the description of a second Amazon.com fulfillment center. The Seattle-based e-commerce retailer is building a facility in North Jacksonville, at Interstate 295 and Pecan Park and Duval roads.

Amazon.com often builds several centers in one area to handle a spectrum of functions. For example, the North Jacksonville center will pick, pack and ship small consumer items. A second center could deal with the larger goods.

That also raised the question of whether the prospective 200,000-square-foot Cecil e-commerce space could be an Amazon.com sortation center.

Hillwood Senior Vice President Dan Tatsch did not say Wednesday who it was, but did say it was not an Amazon.com sortation center, although it is related to e-commerce.

Dallas-based Hillwood is the master developer for the city-owned center, which is at Cecil Commerce Center Parkway and Normandy Boulevard, south of Interstate 10.

Hillwood must submit reports for each quarter to the city Office of Economic Development. The second-quarter report covered April-June.

Seemingly referring to what surfaced as Project Velo, Hillwood told the city it received and responded to a request for proposals from a broker representing a prospect seeking about 1 million square feet of distribution space and was awaiting a response from the prospect at the end of June.

According to last week’s proposed legislation, the Velo prospect is expected to decide on the Cecil site by year-end. It would hire 1,200 people no later than December 2019, which is the same deadline for Amazon.com to hire 1,500 people at the North Jacksonville center.

Velo would hire 325 employees at an average $50,675, while Amazon.com will hire 500 at an average $50,000 in North Jacksonville.

While Tatsch said the smaller prospect was not Amazon.com, he has not addressed whether the large project is associated with the retailer. But he did mention the company in an emailed response.

“The new Amazon development at Duval & 295 is obviously a huge win for the City,” he said.

City and state incentives for the $200 million Amazon.com center total $18.4 million, while the total is $8.3 million for the $115 million Project Velo.

Amazon.com’s 855,000-square-foot footprint reaches 2.4 million square feet of space on multiple levels, while Project Velo is listed as 1 million square feet.

Hillwood, which is developing the business park as AllianceFlorida at Cecil Commerce Center, also said it expects to start construction by year-end on its proposed 400,000-square-foot speculative building.

It said work was in progress on the purchase and sale agreement with the city for the land.

Hillwood said it filed for airspace clearances from the Federal Aviation Administration on the parcel, which is Parcel D.

Tatsch explained the development is within a zone that requires airspace clearance from the FAA. It also had to do so for the GE Oil & Gas building along Normandy Boulevard.

“It’s a fairly typical permitting requirement for any development within a certain distance of an airport’s approach/departure alignments,” he said.

Cecil Airport at Cecil Commerce Center is part of the Jacksonville Aviation Authority system.

In August, Hillwood submitted plans to the city for the proposed 407,435-square-foot warehouse, expandable by almost 100,000 square feet, on 35.43 acres along New World Avenue.

The speculative building should be completed by mid-September 2017.

As the master developer at AllianceFlorida, Hillwood must complete at least 1.2 million square feet of new building area by Sept. 15, 2017, according to the city.

City spokeswoman Tia Ford said previously Hillwood has a little more than 800,000 square feet of new development at the park.

In general Tatsch said in the second quarter, “We saw the same steady improvement in overall activity that we’ve seen in preceding quarters.”

In the report, Hillwood also referred to five more unidentified prospects. It said it:

• Learned a prospect that had been seeking 500,000 to 1 million square feet of distribution space has decided not to pursue plans for a new facility. Hillwood had submitted a proposal in the fourth quarter of 2015.

• Received and responded to an initial inquiry from a defense-industry prospect seeking about 500,000 square feet on about 20 acres.

• Met with representatives of a company evaluating development of a hotel at AllianceFlorida.

• Met with representatives of an international import/export company conducting a preliminary search for a distribution facility in the Southeastern U.S.

• Received a status update from a broker representing a prospect seeking about 300,000 square feet of distribution space. The company is evaluating its options and hopes to re-engage its search during the third quarter, which ends Friday.

Hillwood also said it and The Conlan Co. completed tenant improvements for the GE Oil & Gas facility.

In 2010, Hillwood began a 25-year contract to develop 31 million square feet of industrial and retail space at the city-owned 4,475-acre AllianceFlorida at Cecil Commerce Center.

[email protected]


(904) 356-2466