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Secondary growth depends on exit business

By , - Last modified: August 3, 2012 at 2:14 PM

As properties near the highway exits in Cumberland County are developed with large warehouses and other industrial buildings, it's easy to wonder what comes next for nearby commercial properties.

In most cases, that secondary development could be limited to businesses relying on the transient customer base that increases with traffic off the highway and to warehouses, such as gas stations, convenience stores, restaurants, banks and hotels, executives said.

"That seems to be very consistent at the exits that we've done our developments," said Bob Kiel, senior vice president of Chester County-based Liberty Property Trust.

Liberty is developing a 972,000-square-foot warehouse on Allen Road in Carlisle, a major exit of Interstate 81 for warehousing and manufacturing facilities on the west end of the borough, including Carlisle Construction Materials, a division of North Carolina-based Carlisle Cos.

The Liberty warehouse is part of the Carlisle Distribution Center, which already has about 1.6 million square feet of space occupied by companies such as home appliance company Whirlpool Corp.

The gas stations, fast-food restaurants and hotels generally are the first things to spring up around industrial developments at highway exits, Kiel said.

More of that, as well as hotels and other commercial sites, are planned for the Allen Road exit when Nevada-based Equiterra Properties begins developing The Center at Rocky Meadows, a 60-acre mixed-use commercial property that could include hotels, restaurants, retail and offices.

"People are always looking for places to dine, always looking for the national chains," said Jonathan Bowser, economic development director for the Cumberland Area Economic Development Corp.

The opportunities for secondary development at exits often depend on what's already there. Farther down I-81 at the Newville exit, one warehouse of Key Logistics Park in West Pennsboro and Penn townships houses the northeast distribution hub of Florida-based Office Depot Inc. A second warehouse is being built for London-based consumer products company Unilever.

Key Logistics is just down Route 641 from its intersection with Route 11, where Blair County-based gas and convenience-store company Sheetz Inc. has built a new store. Township economic development officials have pointed out that limited number of large industrial or commercial spaces at some exits will limit future development, but there are still smaller lots and rezoning opportunities that could serve future business growth.

There have been periodic inquiries about that exit, Bowser said.

"Any time you inject about 1,000 employees into an area, you're going to get the gas station, the pharmacy and the bank. They go hand in hand," Bowser said.

There's even potential for ancillary businesses in trucking and logistics to locate near these exits and warehouse sites, Kiel said. Sometimes you'll see trucking-specific gas stations or maintenance shops spring up.

Still farther down the line on I-81, the Shippensburg area could see more development in the future because of its open industrial and commercial spaces, as well as potential for companies to move closer to the expanded Volvo Construction Equipment factory just over the border in Franklin County.

Moving closer to the factory would make sense for Volvo's suppliers or those companies looking to do work with the company, Bowser said.

At the moment, Shippensburg Area Development Co. — that area's economic development organization — hasn't seen a great number of requests from companies that want to locate there, but that doesn't mean no one is considering it, said W. Mickey Nye, the group's president and the dealer and principal of H&H Chevrolet Cadillac.

Business development is certainly a possibility for the future in the Shippensburg area because commercial and industrial properties are available at the King Street exit of I-81, as well as the first exit in Franklin County, he said.

The main hub of logistics and related commercial activity is still Allen Road, but as land there fills up, other exits become just as appealing, Nye said.

"Companies are starting to venture further and further from that hub in Carlisle," he said.

Continued development along the interstate depends on its significant truck traffic carting industrial and consumer goods up and down the East Coast, he said.

Traffic on I-81 from New York to Tennessee accounts for movement of 12 percent of the U.S. gross domestic product, according to the 2011 Harrisburg Area Transportation Study annual report. HATS is an ongoing initiative from the Tri-County Regional Planning Commission to improve Central Pennsylvania's transportation modes.

"We see a lot of containers, and there are intermodal facilities around the area," Nye said. "There's significant opportunity for companies to locate here."

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