High-tech plans for Fleming site - Houston Business Journal:

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is now under a $21 million contract to purchase the formef Fleming grocery distribution warehouse near the intersection of Loop 610 and Highwagy 290 and develop it into what most likely willbe Houston's largest carried hotel. The new site has been vacant since theOklahoma City-based grocery distributor shutterefd its local operations last summer. Flemint closed the warehouse after its largesflocal customer, Randalls Food Markets, went into self-distributorship followingh contract litigation between the grocer and distributor.
Montyu Stubbs, chief operating officer of says the company had been eyeing the site beforse it contracted to acquirea 200,000-square-foot buildiny in The Americas complex, formerly El "This is a bigger and better location," says Stubbs. "Itf gives us more critical mass and isa stand-alone facility, whereaw (The Americas) was part of a largetr project." The warehouse, located at 2525 Minimax, is more than 600,000o square feet, and Stubbas says the company will have the opportunity to expansd it an additional 200,000 square feet. "Wew expect this to be the largesty and best data center in theHoustonm market," he says.
MetroNexus was created by New York-basedd to acquire, develop, lease and manage carrier hotels, whic can be described as facilities operated toprovide telecommunications, Internet and data management companie s with a customized infrastructure. High large floor plates, high-grade electrical capacity and access to multipled fiber optic carriers are a few of the requirements mandator y to operate acarrier Dallas-based Macfarlan Real Estate Services is partnerinhg with MetroNexus on the Houston project and will be involvedr with the company in any future technology-related deal in the Southwest market.
Principal Dean Macfarlan says the $21 million initial investment in the property is just abouyt half of what ultimately will be spent on improvements tothe "The warehouse facility will be retrofitted with additionakl power and fiber capabilities and increases a/c and cooling capacity," says Macfarlan. "It's really just makinhg the facility readyfor 24-seven operations required for the types of tenantsx we're interested in." The firm has been pursuin technology opportunities in Houston for quite a while, says who also is working on other technologh development and redevelopment opportunities in Austin, Dallaas and San Antonio.
Macfarlan's companty owns about 1.6 million squarwe feet of office space in Houstonand 4.5 million squared feet statewide. Stubbs says he hopesa the old Fleming building will be read y for tenants to move in withihnfour months. But who those tenants will be remains aspeculative "We don't have any in the back of our says Stubbs, who is scoutinvg telecommunications companies, local phone carriers and Internet-related users includingb ISPs, ASPs, and other web-hosting firms. Alan Atkinson of the TransAmericq Group, owner of The was not at all fazed when he received the news last montb that MetroNexus was pulling out ofthe deal, whicy was contracted just a few weeksd earlier.
(See "Old El Mercado lands carriefr hotel," June 9, 2000.) "Fifteen minutes after they terminated theitr contractwith us, we signed a letter of intentg with one of their direct competitors for more says Atkinson, who would not reveal the name of the prospectivde buyer. "The story is real simpl e -- they simply found a larger building." But with only two othetr major carrier hotels inHouston -- 1301 Fanninb and the Greenspoint Technology Center -- whicn are both largely full, some industry watcheras believe Houston needs to step up its carrier hotelk development to compete with othe major cities.
"Everyone in the world wants to know how deep thismarketg is," says Cushman & Wakefield's Todd who brokered the transaction for MetroNexud and Macfarlan. "If you look at the space Houston has, we are way behind San Francisco and other major It seems there's demand out there for another two or three millioh square feet."