While officials in neighboring South Windsor debate extending a moratorium on warehouse proposals, East Hartford officials welcomed the prospects for job creation and property tax gains from the 2.5 million-square-foot East Hartford Logistics & Technology Park at Rentschler Field. Image courtesy of National Development
Industrial development has been one of Connecticut’s most active commercial real estate sectors in recent years, and the arrival of mega-warehouses has prompted vigorous opposition in many suburbs and small towns.
The potential to boost commercial property tax rates was welcomed in East Hartford, however, with the recent groundbreaking of a 2.5 million-square-foot distribution center. And in Norwich, a grant from the state’s Community Investment Fund gave new momentum this month for a proposed second business park near Interstate 395.
Lowe’s Home Improvement Warehouse and Wayfair will anchor the East Hartford Logistics & Technology Park at Rentschler Field. East Hartford Mayor Mike Walsh said the fiscal benefits of the project were too strong to ignore, lobbying for its approval when he proposed a $204 million budget for the fiscal year that ends June 30.
“East Hartford was a community in need of this type of development, and $4 million in taxes is a material amount,” Walsh said of the project’s annual contribution. “The community really embraced this at the site.”
Completion is scheduled in mid-2024, bringing an estimated 1,000 jobs.
At East Hartford officials’ request, Massachusetts-based National Development amended its proposal to include up to 200,000 square feet of tech and specialty manufacturing space on the 300-acre site, formerly owned by aerospace manufacturer Pratt & Whitney, subject to tenant demand.
Walsh said National Development’s traffic management plan gave officials confidence that truck traffic will travel to and from Interstate 84 without adding congestion to local roads.
“It’s very insulated even though it’s in the center of our community,” he said.
Industrial Leasing Dipped in Q4
Leasing activity for industrial space remained active in the central Connecticut market in 2022, according to research from brokerage Cushman & Wakefield.
The central Connecticut submarket had 1.9 million square feet of positive absorption. Vacancies in the Hartford-New Haven submarkets dropped 0.3 percent to 4.4 percent.
But activity slowed in the fourth quarter, with only 159,000 square feet of new leasing after more than 1 million square feet in the first three quarters of 2022.
While leasing activity has declined because of slowing macroeconomic conditions, some communities are reviewing additional regulations for industrial projects.
After declaring a moratorium on warehouse proposals in April 2022, the town of South Windsor is debating an extension through August while it considers new regulations.
The Planning and Zoning Commission is reviewing new zoning changes that would add new reviews for some types of projects, including requirements for buffers and screening from neighboring properties.
The town’s Planning and Zoning Commission recently continued a public hearing on the proposal until March 28, Town Planner Michele Lipe said.
Grant Boost Norwich Business Park Plan
In Norwich, a connection from an interstate highway to the city’s largest undeveloped parcel is critical to the planning for a proposed second business park.
The Norwich Community Development Corp. is seeking to build the Business Park North on a 384-acre site bordering Interstate 395 just south of the Route 97 exit.
Last week’s receipt of a $11.4 million grant from the state’s Community Investment Fund will enable the agency to move ahead with predevelopment, including plans for an arterial road and utilities for the project’s first phase.
“It’s a safe approach to get some momentum going and attract some development in the first third of the property, and then extend that through phased development,” said Kevin Brown, president and executive director of the Norwich Community Development Corp.
The grant would pay for a 2,700-foot section of the 7,700-foot arterial road.
The site contains about 184 developable acres, Brown said. An analysis by consultants RKG Assoc. concluded that the initial phase, spanning 108 acres, could support 1.1 million square feet of development including flex, warehouse, manufacturing and distribution space.
The agency proposes rezoning the property as a master plan business district zone. The Norwich City Council, which also functions as the city’s zoning board, rejected the rezoning on a 3-3 vote in late February. Neighbors objected to increased traffic, noise, light pollution and loss of wildlife habitat.
The property is currently zoned for commercial use. The NCDC will promote the property through the Advance CT economic development agency’s online listing of shovel-reading projects, and plans to hire a commercial broker in the next month, Brown said. The agency also plans to renew its discussions with the Norwich City Council on the rezoning.
“This is an ever-evolving conversation,” Brown said. “The good news is we’re not far apart, between what we offered in the master plan district and where the Zoning Commission wanted to go.”
