Parkway III and IV are located at 2697 International Parkway.

 Industrial Segment Strong in Hampton Roads

CHESAPEAKE, VA - The vacancy rate for the industrial sector in Chesapeake's Greenbrier submarket was 4.7 percent at the end of 1999. This is the second lowest rate of all Southside markets. This low vacancy rate, which has remained steady for a few years, has justified the speculative development of several buildings.

One such new project is Interstate Park, an office/warehouse development located on Military Highway. The building will encompass 36,000 square feet on 3 acres adjacent to the RPS distribution facility. It will be an upscale brick and glass facility, subdivisible into units as small as 2,250 square feet. Each unit will have one grade-level loading door in the rear of the building. The entire flex building is available, with expected occupancy in late fall of 2000.

"The excellent access of this site, combined with a competitive market rate, is expected to attract users with 50-60 percent office components that need loading/distribution in back," according to Jonathan Guion, principal in charge of Divaris Real Estate's industrial division in Hampton Roads, Virginia.

The adjacent RPS distribution center is a local package sorting facility for Roadway Package Service. Fronting Military Highway is a 5-acre parcel in the Interstate Park property that is being offered separately. The undeveloped outparcel is zoned B-1 and is available for sale or lease by DRE's Newport News, Virginia, office.

Additionally, Divaris Real Estate has assumed the management and leasing of Parkway III and IV, located in the Lynnhaven section of Virginia Beach, Virginia. The two buildings comprise 64,567 square feet of office and office/flex space and they are owned by Oceana West Operating Associated LP, an affiliate of BGK Properties of Santa Fe, New Mexico.

Management of these properties is being handled by Tazewell Reinhart of Divaris Property Management Corp. in Virginia Beach, while leasing is being undertaken by Joyce Johnson and Brian Devlin of DRE's office/industrial division, also in Virginia Beach.

In addition to Parkway III and IV, DRE is exclusive leasing agent for 503 Central Drive (33,200 square feet) and 513 Central Drive (22,601 square feet), also in the Lynnhaven submarket of Virginia Beach.

The Lynnhaven industrial submarket is comprised of approximately 4.6 million square feet, making it the sixth largest of the eleven Southside Hampton Roads submarkets. The vacancy rate recorded at the end of 1999 for Lynnhaven was 3.7 percent, compared to an overall vacancy rate of 7.6 percent.

Over the past six months, several new multi-tenant office/warehouse properties have saturated the demand for 2,000-5,000-square-foot users. This has caused owners in the area to offer lower rental rates and larger tenant improvement allowances. The Lynnhaven vacancy rate at the end of 2000 will likely show a slight increase, as new square footage is added.

Based on the strength of its experience in industrial real estate in Hampton Roads, Divaris Real Estate has been appointed to sell 11 Heafner Tire properties along the East Coast. Heafner Tire Co. was bought by ITCO, another tire distributor that has its own facilities.

The portfolio consists of 248,285 square feet of office/warehouse space. The buildings range from 13,000 square feet to 85,000 square feet. The largest building is located in Rome, Georgia. The smallest property is located in Pensacola, Florida. Other locations include: Chesapeake, Richmond and Roanoke, Virginia; Knoxville, Tennessee; Tallahassee, Florida; Texarkana, Arkansas; Salisbury, Maryland and two retail centers in Virginia Beach. All of these buildings are for sale and are expected to attract buyers from regional industrial distribution owner-occupiers or investors.

"It has been about six months since we received this assignment, and we have three properties under contract, and two others have contracts pending," says Joyce Johnson.