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By Karen Gentry | TransActions
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MUSKEGON HEIGHTS — When industrial companies move or go out of business, cities can find themselves stuck with large, old, vacant buildings. But increasingly, commercial Realtors are reporting more interest in these old facilities since developers can buy them cheaply and get money back by tearing them down and recycling the material.

One example is the 475,000-square-foot former Lift-Tech International building in Muskegon Heights, which sold this summer to a Wisconsin-based transportation and logistics company.

Brian Bench, principal with Signature Associates, said WEL Companies Inc. bought the building on 414 West Broadway and some machinery for $1.25 million and plan to recycle the building.

Signature Associates represented the New York-based Columbus McKinnon Corp., the seller in the transaction. Although the building most recently went by a couple of different names, Lift-Tech operated in the building for nearly 100 years. The building was built in phases with some parts dating back to the late 1800s.

“They were certainly interested in the recycling part of the deal. They’ll sell the steel, the copper — everything from bricks to the wood floors,” Bench told TransActions.

Bench said if the company retains any portion of the building, it will be the high bay sections with 35- to 40-foot ceilings, possibly useful for warehousing. The $1.25 million selling price breaks down to a few bucks per foot or less. Bench said the sale is part of a national trend of buyers purchasing big industrial buildings for recycling.

“That’s kind of what the market is bearing right now. A lot of other companies are looking at older plants to recycle the valuable essence of these old buildings,” he said.

He noted that sometimes the recycled buildings are donated back to the municipality for redevelopment.

Brighter picture for industrial?

Although it’s difficult to find users of 500,000-square-foot buildings, the industrial market is definitely picking up for smaller users, according to Bench. In northern Ottawa County, Muskegon and up to Traverse City, there’s more demand for 10,000- to 30,000-square-foot buildings.

“A lot of companies in that size are doing a lot better,” Bench said.

He said purchase orders are up for smaller factories, and many businesses are bringing people back. He noted industrial is the first side of commercial real estate to improve, with office and retail lagging behind.

Drew Miller, managing director with CB Richard Ellis, a commercial real estate services firm, said industrial activity has definitely picked up in the last six months. CB Richard Ellis’ territory includes West Michigan from Ionia to the lakeshore. He said his firm continues to see interest from food manufacturers and is fielding more inquiries for larger buildings of 50,000 square feet and up. CB Richard Ellis is also seeing more interest from automotive-related production businesses. Although most transactions are centered in greater Grand Rapids, CB Richard Ellis is closing deals in other areas.

“We had some specific uses in the Muskegon/Norton Shores area as well as a couple of transactions in the Holland market,” Miller told TransActions.

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TAGS:

• brian bench
• columbus mckinnon corp
• commercial real estate
• industrial buildings for recycling
• lift-tech international
• muskegon heights
• recycling
• recycling old industrial buildings
• signature associates
• wel companies