The first major tenant, global chocolate maker Barry Callebaut, has committed to the Granite Telephone City Logistics Centre which is now under development in Brantford.
Granite REIT’s (GRT-UN-T) 1.7-million-square-foot business park, located an hour’s drive west of Toronto, used the resources of JLL to pre-lease a 409,000-square-foot building to Barry Callebaut that will become a specialty chocolate production facility.
Granite acquired the 92.2-acre Brantford site along the Hardy Road-Oak Park Road corridor for $62.2 million last August.
“We were drawn to Brantford largely by its compelling relative value proposition presented to industrial users and developers,” Granite executive vice-president of global real estate and head of investments Michael Ramparas told RENX.
“It was a node that I considered emerging compared to a lot of the other suburbs around the GTA that were getting a lot of institutional investment. We really saw a value opportunity and that’s what drew us to the region.”
Barry Callebaut will invest heavily in building
Zurich, Switzerland-based Barry Callebaut will invest more than $130 million into its Brantford building, making it its largest capital investment in a North American production facility.
“It will be a somewhat generic facility, but once the tenant is done with their outfit it will be very specific to it, as you can tell by the amount of capital they’re investing in it,” said Ramparas.
Barry Callebaut Group runs more than 60 production facilities worldwide and employs a workforce of more than 13,000. The manufacturer of chocolate and cocoa products had sales of about $7.9 billion US in its fiscal year ending in 2021.
The Brantford factory will create approximately 200 jobs after it’s delivered, which is expected in the first quarter of 2024.
“We’re very excited to be working with a tenant of this calibre and building its new home in Brantford,” said Ramparas. “It’s an obvious location as it relates to Brantford’s strategic strengths in the food and beverage manufacturing and distribution area.”
Granite Telephone City Logistics Centre is targeting a two Green Globes certification, which demonstrates a significant achievement in resource efficiency, reducing environmental impacts and improving occupant wellness.
Ramparas said efficiency and sustainability are very important factors in all buildings Granite either acquires or develops.
Brantford growing and attracting interest
The REIT plans to fill out the rest of Granite Telephone City Logistics Centre with what Ramparas called “modern, state-of-the-art distribution facilities.” He said there’s been plenty of interest from potential tenants for the site.
“We are seeing a number of larger distribution-based tenants coming out of the Toronto market,” JLL executive vice-president of sales and leasing Mitchell Blaine told RENX. “It’s relatively value-priced compared to Toronto.”
Brantford is located along Highway 403, just beyond the western edge of the Greater Toronto Area in the so-called Greater Golden Horseshoe, and has been designated an urban growth centre in the provincial growth plan.
The city’s population is approximately 100,000 and is projected to reach 163,000 by 2041.
“With the pandemic, we definitely saw a dispersion of the labour pool from the surrounding markets into Brantford and the Brant County area,” said Blaine. “We’ve seen some pretty exceptional population growth and projections.
“A real focus for the chocolate folks was access to the labour pool. When the Granite team could match that labour access and value proposition with modern, state-of-the-art facilities along a highway, it was checking a lot of the boxes. That has been a big driver.”
Brantford has a diversified manufacturing sector and a post-secondary education presence via Wilfrid Laurier University and Conestoga College campuses.
Granite is a Toronto-based real estate investment trust engaged in the acquisition, development, ownership and management of logistics, warehouse and industrial properties in North America and Europe. It owns 139 investment properties representing approximately 57.5 million square feet of leasable area.
One of those properties is a 32-acre site occupied by a 398,080-square-foot food manufacturing and distribution facility at 115 Sinclair Blvd. in Brantford that’s completely occupied by Aspire Bakeries.
That site and Granite Telephone City Logistics Centre comprises Granite’s industrial real estate presence in Brantford, but Ramparas said it’s looking at other properties in the area and called it “a big acquisition target for us.”
Other Brantford industrial development activity
There’s been plenty of industrial real estate development and transaction activity in and around Brant County over the past couple of years.
Panattoni Development Co. Canada acquired a 423-acre tract of industrial development land for $290 million in April after purchasing 100 acres along Rest Acres Road the previous year.
Two Fiera Real Estate funds acquired five industrial buildings comprising about 940,000 square feet of space for about $118 million from local developer and property manager Vicano Construction Ltd. last year.
The properties ranged in size from about 12,000 square feet to a 530,000-square-foot, one-tenant distribution centre completed in 2020.
The Lasalle Canada Property Fund bought the 527,568-square-foot Procter & Gamble national distribution centre from GWL Realty Advisors last year.
Paris, Ont.-headquartered 214 Carson Co., which focuses on mid-sized industrial developments in Southwestern Ontario, owns 26 acres of industrial land in Brant County.
It’s developing a 125,000-square-foot building and a 51,000-square-foot building, and adding 50,000 square feet to an existing building in the county.
Blaine said Brantford’s industrial availability rate was an extremely low 0.95 per cent in Q2 and the local industrial market was performing “incredibly well.”
The biggest challenge is getting facilities built and to market, but Blaine still foresees future growth.
“Servicing, timing and availability of trades still pose challenges. Will there be growth? Absolutely,” he said.
“Can it get here quick enough? Not as fast as anybody, tenants and landlords alike, would like to see.”