By: Morris Newman
Underscoring the high rate of job creation in California's Inland Empire, developers in Riverside County are expected to start construction this month on the first buildings at Meridian, a 960-acre commercial-industrial park on the site of the former March Air Force Base.
Described by its developers as the largest master-planned business park to start construction in the region in more than 20 years, the 16 million sq. ft. Meridian will be built out over the next 10 to 15 years.
The Meridian development is a response to economic growth in Riverside County. Located directly east of Los Angeles County, Riverside will "continue to lead the Los Angeles metropolitan area with jobs, sales and income all growing at rates well over 5% in 2005," said Raphael Bostic, an economist with the Lusk Center for Real Estate at the University of Southern California color>, in a December 2003 report.
The land developer is a partnership of Lennar Properties of Newport Beach, Calif., the commercial real estate unit of L&R Property Co. of Fla., and the March Joint Powers Authority, a public agency that is overseeing the "realignment" of March Air Force Base. Lennar's credentials in base reuse include ongoing work at Hunters Point Naval Annex and Mare Island Naval Shipyard, both in the Bay Area, and the South Weymouth Naval Air Station in Massachusetts.
Located immediately north of the city of Riverside, March changed from an active base to a reserve base in 1996, when 4,400 acres of raw land became available for development. That acreage includes Meridian, the 350-acre cargo airport and a 1,178-acre wildlife habitat dedicated to the Stevens kangaroo rat, an endangered species.
Currently, three developers are in escrow to buy individual parcels at Meridian for speculative projects, according to Walt Chenoweth, senior vice president of CB Richard Ellis and a member of the sales team.
One selling point is the availability of the airport runway for both chartered flights and cargo. Another is the high number of freeways and highways serving the area, as well as three miles of rail frontage. The area is a "free trade zone," enabling industrial tenants to import raw materials tax-free, paying import taxes only on finished goods.
The most obvious appeal, however, is the availability of industrial land in the fast-developing Inland Empire. In the popular Ontario Airport-area market 20 miles west, "there is little land available within a five-mile radius," says Chenoweth. The dirt in Riverside is comparatively affordable, according to the CB Richard Ellis official. Improved industrial land in Riverside runs from $4.50 to $6 per sq. ft., compared with $10 to $15 for land in neighboring East Los Angeles County and $15 to $20 in Orange County.
Local employment also is a goal, Rizzo adds. "We have a jobs-housing imbalance in Riverside County, with many people commuting to Los Angeles or Orange counties."
For the local economy, the goal is to replace the 9,000 military and related jobs lost at the former Air Force base since 1996, according to Phil Rizzo, former base commander who is currently executive director of the March Joint Powers Authority. Ultimately, the base hopes to attract 38,000 jobs and generate $800 million in tax increment financing.