Visalia Times-Delta

Visalia Industrial Park Lands Client for Warehousing

Tulare efforts for an industrial park still in planning stage

January 24, 2007

Visalia’s large-scale, 12-year-old industrial park continues to attract interest from a variety of companies wishing to ship and warehouse goods – and Tulare has industrial-park plans of its own.

Developer Bill Morgan of Exeter wants to buy 280 acres of land along state Highway 99 near the Tulare Municipal Airport. He hopes the site can be transformed into an industrial park on par with Visalia’s.

Can Tulare, like Visalia, become a serious player in warehousing and transportation?

“Competition is always going to be a factor in these types of businesses,” said Fred Brusuelas, a Visalia city planner. “Actually, the challenge for Visalia will be to purchase more property in that area so it can grow.”

That’s also the opinion of David Hernandez, director of construction services for Visalia-based The Allen Group, which just landed another client for its 480-acre Midstate 99 Distribution Center at the Visalia industrial park. WorkflowOne, a major business documents producer and distributor based in Dayton, Ohio, has agreed to lease 118,000 square feet of warehouse space, said Douglas Burnham, the company’s director of business services.

Burnham’s company did have its distribution center at a Tulare location, but opted for Visalia because of the way the current industrial park is set up.

“The Tulare location was more designed for manufacturing,” he said. “But the location in Visalia is better set up for warehousing and distribution.”

However, should Tulare come through with an industrial park that appeals to prospective shippers and warehousers, competition will intensify.

“Technical details, if handled properly, will give inquiring companies confidence in your city’s ability to expedite warehouse and transportation arrangements,” Brusuelas said.

It’s not enough to offer space for a warehouse and a road leading to it, he said.

Hernandez said that The Allen Group, started by Richard S. Allen – whose son, Luke Allen, who just joined the company, is a Redwood High graduate – began in Visalia and has spread nationally into such hub cities as Dallas and Kansas City. But the core business centers in California.

“The Allen Group and other companies located in Visalia are almost exactly split down the middle in distance between the ports of San Francisco and Oakland to the north, and Long Beach and San Pedro to the south,” Brusuelas said. “That is a huge advantage for shipping.”

The Allen Group isn’t the only company attracted to the Visalia industrial park.

Last month, the planning commission approved more than 1 million more square feet of warehousing space near Midstate 99 for the Diversified Development Group. The buildings are finished, ready for customers.

Commercial Property News

Allen Group Leases 118,000 SF of Industrial in California

January 23, 2007

The Allen Group, a major developer of industrial and office properties across the United States, today announced that it has leased space in the MidState Hayes Building #2 to WorkflowOne, a leading provider of document and business process outsourcing services. The 10-year lease covers 118,000 square feet of warehousing and distribution space at theMidState 99 Distribution Center on the northwest corner of Plaza Drive and Ferguson Ave. in Visalia, Calif.

Central Valley Business Times

Visalia Distribution Center Gains Another Tenant

WorkflowOne to lease 118,000-square-feet

MidState 99 Distribution Center now has two more buildings filled

January 23, 2007

WorkflowOne, which sells document and business process outsourcing services, it has leased space in the MidState 99 Distribution Center in Visalia, according to the developer of the complex, the Allen Group, a San Diego-based developer of industrial and office properties.

The 10-year lease covers 118,000 square feet of warehouse and distribution space in the MidState Hayes Building #2.

“The new business service center in Visalia will help WorkFlowOne offer improved services to our West Coat customers,” says Douglas Burnham, senior director of distribution services. “In addition to increased inventory capacity, it enables us to provide  one0day shipping to virtually all of California.”

The MidState 99 Distribution Center has direct access to Highway 99, the state’s major trucking center.

“MidState 99 is unlike any other distribution and manufacturing site in the state,” claims Harve Filuk, vice president of development in California for The Allen Group. “Companies located at MidState 99 tactically benefit from the ability to efficiently serve 98 percent of California overnight via next-day UPS Ground service, which is nearly impossible from other distribution locations.”

The tenant signing of WorkFlowOne will result in MidState Hayes Buildings #2 and #3 being 100 percent occupied, Mr. Filuk says.

He says his company is in the planning stages for the next speculative buildings at MidState Business Park, with hopes to begin construction this summer.

WorkFlowOne is a unit of privately held WorkFlow Management Inc. of Greenwich, Conn.

Fidelity Investments

MidState Hayes Buildings #2 and #3 Now Fully Occupied

January 22, 2007

VISALIA, Calif., Jan 22, 2007 (BUSINESS WIRE) — The Allen Group, a major developer of industrial and office properties across the United States, today announced that it has leased space in the MidState Hayes Building #2 to WorkflowOne, a leading provider of document and business process outsourcing services. The 10-year lease covers 118,000 square feet of warehousing and distribution space at the MidState 99 DistributionCenteron the northwest corner of Plaza Drive and Ferguson Avenue in Visalia, Calif.

“The new business service center in Visalia will help WorkflowOne offer improved services to our West Coast customers,” said Douglas Burnham, Senior Director of Distribution Services. “In addition to increased inventory capacity, it enables us to provide one-day shipping to virtually all of California.” WorkflowOne offers a wide variety of print and promotional products, as well as fulfillment and distribution services, to organizations of all sizes across the United States.

The MidState 99 Distribution Center is strategically located in the heart of Calif. With direct access to Highway 99, the state’s major trucking corridor, companies located at MidState 99 have the distinct advantage of being able to access both northern and southern California.

“MidState 99 is unlike any other distribution and manufacturing site in the state,” said Harve Filuk, Vice President of Development, California, The Allen Group.

“Companies located at MidState 99 tactically benefit from the ability to efficiently serve 98 percent of California overnight via next-day UPS Ground service, which is nearly impossible from other distribution site locations.”

The tenant signing of WorkflowOne will result in MidState Hayes Buildings #2 and #3 being 100 percent occupied. Filuk notes that the Company is already in the planning stages for the next speculative buildings at MidState Business Park, with hopes to begin construction this summer.

For more information on MidState 99 or The AllenGroup, log on to www.allengroup.com .

Editor’s note: A high resolution photo of the MidState 99Distribution Center is available upon request.

About The Allen Group

The Allen Group is a commercial development firm specializing in rail-served industrial parks and build-tosuit facilities, including Class A office buildings. The Company currently has 8,000 acres under development across the United States, with commercial properties ranging in size from 35,000 square feet to 1.7 million square feet, as well as four master-planned industrial parks. These projects include the International Trade andTransportation Center ( www.ittc.com ); MidState 99Distribution Center ( www.midstate99.com ); the DallasLogistics Hub ( www.dallashub.com ), and recently announced, a new BNSF Intermodal logistics hub near Kansas City.

The Allen Group, based in San Diego with regional offices in Visalia and Bakersfield, Calif., as well as Dallas, Texas, is trusted by Fortune 500 companies such as VF Corporation, Cox Communications, FedEx, International Paper Company, Intuit, Kraft Foods and Wal-Mart Stores. For more information about The AllenGroup, please visit www.allengroup.com .

The Dallas Morning News

And the Next Move … Dallas Logistics Hub is ChallengingFW’s Alliance for King of Industrial Centers

January 19, 2007

The newest rivalry between Dallas and Fort Worth has nothing to do with museums, sports teams or major airlines.

Thanks to recent development in southern Dallas County, each city now lies near a massive industrial and logistics park where developers are eager to build warehouses and distribution facilities.

In one corner sits a dominant Alliance, the 11,600-acre development north of Fort Worth that opened a little more than 17 years ago. Its owner: Hillwood, the large commercial and residential developer owned by Ross Perot Jr.

The challenger is the 6,000-acre Dallas Logistics Hub, which is south of downtown Dallas along Interstate 45 and other key highway and rail routes to the east. The Allen Group, a California real estate developer, owns the project and has begun to market it but hasn’t yet broken ground.

The hub is pursuing the same tenants Alliance does, such as big-box retailers and manufacturers. The battle may be David vs. Goliath, but it is the first time Alliance has faced a major local competitor.

Having two industrial parks should enhance North Texas’ reputation as one of the leading distribution centers in the country. It will give companies looking for warehouse space more choices.

But it could lead to squabbles over where government funds are used to build highways and other infrastructure for the region.

“There’s going to be intense competition,” said Terry Pohlen, director of the Center for Logistics Education and Research at the University of North Texas.

As international trade increases, there could be plenty of room for both parks, he said. Imports from China are soaring, and many of those goods are hauled from West Coast ports by freight trains to central locations like North Texas for distribution.

Competition between the parks is just beginning.

The Allen Group hasn’t signed any tenants yet for its Dallas hub, said Jon Cross, the company’s director of marketing, but it has made presentations to several Fortune 500 companies. It says it will advertise this year in national trade publications, such as Site Selection, and market the property at trade shows for site selectors and logistics firms.

The Dallas Logistics Hub plans to start construction of its first commercial buildings this year, along with a bridge and other infrastructure.

In an interview last fall, Richard Allen, the developer’s chief executive, said his park could offer tenants more attractive lease deals than Alliance.

Currently farmland, the property lies in an area long plagued by a lack of development and a high unemployment rate. Officials in Dallas, Wilmer, Hutchins and Lancaster are backing the project because it promises to create thousands of jobs.

Rail routes

Both parks are next to giant railroad terminals where truck drivers pick up shipping containers hauled by trains from West Coast ports.

Burlington Northern Santa Fe Corp., the Fort Worthbased railroad, handled about 587,000 containers and trailers at its Alliance terminal last year, up 42.5 percent from 2000 levels.

At the Dallas Logistics Hub, a $100 million Union Pacific terminal opened in 2005. The hub could gain an edge over Alliance if it gets a second rail terminal. Burlington Northern is negotiating with the Allen Group for an option to purchase several hundred acres at the Dallas hub for such a facility.

Alliance is a foreign trade zone, which means companies can eliminate certain U.S. customs duties and delays, and reduce their paperwork and fees.

The Dallas hub has applied for this designation and expects to receive it.

Despite the publicity surrounding the Dallas hub, business shows no signs of slowing down at Alliance. It continues to attract new distribution centers for goods made in Mexico and Asia.

Later this month or in early February, Alliance is expected to announce a deal with a Fortune 500 company that will lease more than a million square feet for its products, which are produced in Mexico.

That comes on top of landing a 402,500-square-foot center for the distribution of Mexican-made Lego toys. And several existing tenants, such as IDC, which imports outdoor lighting products, have announced plans to expand their facilities or move into bigger ones.

Selling points

“We’ve tried to work with people on not just real estate, but other issues that impact their business” such as labor and transportation, said Bill Burton, senior vice president of Hillwood Properties.

When asked whether Alliance is lowering leasing rates because of the Dallas hub, Mr. Burton said, “We have to compete. We have a lot of things to offer besides the real estate.”

These include the flexibility of owning multiple buildings in a single park, workforce training and screening, and proximity to Dallas/Fort Worth International Airport’s cargo operations.

Mr. Burton says he hasn’t run into a situation yet where a potential tenant was trying to decide between the two developments and pressing for better deals from both.

But such a scenario may not be far off. Target Corp. is rumored to be looking at both parks for a new distribution center in North Texas.

Target did not return telephone calls seeking comment, and both the Allen Group and Alliance said they couldn’t discuss the matter.

“There will be deals that look at both,” Mr. Burton said. “We’re going to have competition.”

‘Still climbing’

Companies building or leasing facilities at Alliance are well aware that there’s an alternative in southern Dallas County.

KFS Inc. of Grapevine, a logistics and transportation services provider, decided to build a 140,000-squarefoot freight forwarding facility at Alliance because “it is an established quality development,” said James Keller, the company’s president.

“While it has a lot of potential, it [Dallas Logistics Hub] is not as far along,” he said.

But Alliance isn’t resting on its laurels. The park is only 35 percent developed and is launching five more buildings, Mr. Burton said. In addition, it’s trying to make it easier to get in and out of the development by adding more lanes to Interstate 35

West.

And at Fort Worth Alliance Airport, which is located within the park, officials are working to extend the runways to accommodate bigger cargo planes.

“You always need to check your rearview mirror,” Mr. Burton said. “In our opinion, we’re still climbing the mountain.”

The Kansas City Star

Gardner Seeks Lawmakers’ Help Securing Interchange

January 18, 2007

Gardner officials asked Johnson County lawmakers on Wednesday for help getting a new interchange on Interstate 35 to serve a planned 1,300-acre freight center there.

Officials from BNSF Railway Co. and the Allen Group, developers of the project southeast of Gardner, called the project the largest economic development effort in Kansas in the last 40 years.

Skip Kalb Jr., the railroad’s strategic development director, said the project would generate 13,000 jobs and provide $2 billion in economic benefit to the state.

“So, what’s the problem?” asked Sen. David Wysong, a Mission Hills Republican, after the 40- minute presentation to a meeting of the Johnson County legislative delegation.

“We need an interchange,” said Gardner Mayor Carol Lehman. “We want to have it happen as quickly as possible. We don’t want trucks driving up and down our city streets.”

Steve Forsberg, a BNSF spokesman, said estimates for construction of an interchange range from $15 million to $25 million.

Kalb said the railroad hopes to open the freight facility late next year. Officials said the exact location of the interchange hasn’t been determined but it would be near 199th Street and I-35.

“You can count on this delegation to advance the progress of this project,” said Rep. Arlen Siegfreid, an Olathe Republican and chairman of the county delegation.

Gardner will be facing tremendous transportation demands as BNSF moves forward with a 350-acre intermodal hub that will be coupled with a 1,000- acre warehouse and distribution center on the city’s western edge.

When the freight center opens in 2008, it could generate roughly 5,900 vehicle trips a day, of which a little more than a third will be trucks.

Traffic is expected to grow to 59,000 vehicle trips a day by the time the center is fully built out in 2025.

About 10,000 of those trips will be trucks. A study indicates the traffic will require an estimated $66 million in road projects, including the new interchange on Interstate 35. The I-35 interchange at Gardner Road also will need to be modified to handle increasing traffic that will come with the project.

CoStar Group

The Allen Group Taps New VP of Development

Harve Filuk To Lead California Division

January 16, 2007

Harve Filuk, who has more than 20 years experience dealing with commercial real estate development, was named vice president of development with The Allen Group’s California division. The Allen Group is a commercial development firm that specializes in build-to-suit facilities and industrial parks.

In his new role, Filuk will manage all of the company’s interests in California as well as development projects. He previously managed all of the Allen Group’s commercial developments in San Diego. Filuk has been with The Allen Group since 1999.

The Fresno Bee

MAK’S EATERY READY FOR TAKE OFF; Restaurant is just one of a number of additions at Chandler Executive Airport.

January 8, 2007

One of the nation’s largest distributors of animal health products is consolidating Tulare and Fresno operations into a new warehouse in Visalia. Walco International has signed a lease to occupy 68,000 square feet in a warehouse owned by TheAllen Group, a major commercial developer.

“Visalia provides a strategic location for the distribution of our products throughout the West Coast,” said Mark Gray, vice president of operations for Walco.

The warehouse is near Visalia’s airport, but is only a small part of The Allen Group’s presence in the San Joaquin Valley. The company has developed about 2 million square feet of industrial and commercial property in Visalia, where it has the 480-acre Midstate 99 Distribution Center.

VF Corp, one of the world’s largest clothing companies, announced plans to operate a 1 millionsquare- foot warehouse at Midstate 99.

The Allen Group also has the 700-acre International Trade and Transportation Center in Shafter, which is home to a 1.7 million-square-foot distribution center, and recently bought 107 acres next to Meadows Field Airport in Bakersfield, where it plans offices and stores, said Jon Cross, a company spokesman.

That adds up to a lot of land to develop, but Cross said businesses are seeking out space in the Valley because they want out of congested and expensive real estate in the Los Angeles and San Francisco regions.

The Allen Group is developing a total of 8,000 acres in the United States, including 6,000 acres near Dallas, Texas. It also will be a partner with BNSF railway in an industrial park project in Texas.

All this from a company started by Richard Allen in Visalia after he sold a cup-manufacturing business.