Northern Suburbs of Indianapolis See Vast Growth in Urban Core Development
IKEA is slated to open this month in Fishers, Indiana. This is the first store in the state of Indiana for the Swedish furniture retailer.
The northern suburbs of Indianapolis aren’t just following the latest trend of developing dense urban cores within suburban markets — they’re on the leading edge. In particular, Fishers and Carmel boast flourishing downtown environments that are walkable and bike-friendly.
The idea is to develop a core urban area amid the suburban sprawl by creating activities and concepts that serve various community needs such as cool restaurants, shops, office and living space, evening events for adults, family activities and music and arts entertainment. It’s a lifestyle choice that more and more people prefer.
While retail is struggling to regain balance in traditional environments, these mixed-use developments are resonating with their communities. Consumers are looking for experiential opportunities with multiple touch points, such as living, shopping, fitness, dining and entertainment options that integrate open green space. The suburbs of Indianapolis are responding to this trend. Grocery stores and medical facilities also are key to these types of developments, as residents desire the convenience of making one stop.
Fishers blazes its own trail
Fishers, located just northeast of Indianapolis in Hamilton County, officially became a city in 2015. The community elected a mayor with a strong vision. That vision included the urban core concept and answered residents’ demand for unique, higher-end restaurants other than chain restaurants.
Redevelopment projects totaling nearly $90 million were unveiled, including several mixed-use projects in the Nickel Plate District around the city center. Construction firm Meyer Najem built a new two-story, 40,000-square-foot headquarters for its 70-plus employees.
Launch Fishers, a collaborative and co-working space for incubator businesses, outgrew its original offices and developed a new facility to hold more than 500 entrepreneurs. Also, ClearObject (formerly CloudOne) moved to Fishers from Indianapolis, and Four Day Ray, a local brewing company, opened a downtown location.
But it was IKEA’s announcement about opening a store in Fishers in 2017 that turned the city’s strong start into a full-fledged transformation, spurring several multi-million dollar projects: Chicago-based eatery Portillo’s; sports entertainment venue TopGolf; The Yard in Fishers District, a 17-acre culinary development with incubator space for young chefs, about 20 restaurants, shops and a hotel; and The Stations, a restaurant and retail project just east of The Yard II.
These developments have fueled demand for the area’s existing 6.4 million square feet of inventory, reducing vacancy to 4.8 percent overall. A combined 1 million square feet of retail and mixed-use space have been added to the Fishers and Noblesville submarkets since 2008.
Hoosiers have eagerly awaited the Oct. 11 grand opening of the $40 million IKEA store, the first in Indiana for the Swedish furniture retailer. The 289,000-square-foot building and 1,000-space parking lot are located on 35 acres just east of I-69 and south of the 116th Street exit.
Portillo’s, greatly anticipated by Chicago transplants and natives alike, opened nearby on Sept. 28. TopGolf is expected to open this fall, too.
As communities add amenities, employers are relocating their headquarters to be near them, creating a win-win environment. In its quest to carve out a high-tech niche, Fishers will be home to the state’s first Internet of things (IoT) lab, expected to open in 2018. This launch of a workplace to create smart technology for ordinary devices positions the city not only for future economic growth, but also as a key IoT leader for Indiana.
Fishers recently captured the
No. 1 ranking on Money magazine’s “10 Best Places to Live in America.” Beyond the low cost of living, parks and open space were two of the reasons the city earned the top spot in the rankings. Fishers has since unveiled a $6 million project to redevelop its
10-acre green space, including an expansion of the outdoor amphitheater, pavilion and playground climbing wall.
Carmel’s development spree
Carmel, centrally located in Hamilton County just north of Indianapolis, has had more time to develop its urban core. Led by a mayor with an equally strong vision, Carmel has already developed City Center and the Arts & Design District, and is now linking the areas with Midtown Carmel — a mixed-use development that will add 400 multifamily units, 300,000 square feet of Class A office space, street-level retail and structured parking.
With anticipated costs of more than $210 million, the 17 acres of mostly industrial space is divided into east and west portions by the Monon Trail. The 1.2-mile walking and biking trail, which extends from First Street to Carmel Drive, will be expanded from a 12-foot-wide path to a 140-foot-wide corridor that includes boulevards, sidewalks, bike lanes, green spaces and free parking via a $23 million project.
The Carmel retail trade area has over 5.1 million square feet in inventory and an overall vacancy rate of 6.8 percent. Since 2008, nearly 800,000 square feet of retail and mixed-use inventory has been added to the Carmel and Westfield submarkets.
Total estimated mixed-use spending includes $60 million for Anderson Birkla Investment Partners LLC’s Proscenium project, $10 million for Midtown East and $85 million for Midtown West.
A $100 million City Center expansion includes 10 buildings with about 500,000 square feet of apartments, commercial space and a parking garage. Additionally, the $30 million Lazzarra project will feature an upscale steakhouse, retail space, residential units and a public plaza.
Midtown East includes a building for Allied Solutions and F.C. Tucker; Sun King Brewing Co.’s distillery and taproom; two parking garages; and Midtown Flats, which features 206 apartment units and a retail component. Midtown West includes a Merchants Bank headquarters with ground-level retail or restaurant space and a 170-unit, high-end loft building and parking garage.
The city is still planning the last section of Midtown on land that borders Rangeline Road. A developer has indicated interest in building a hotel, and additional office, retail and restaurant opportunities are being considered.
Whitestown draws interest
Just a 20-minute commute to downtown Indianapolis, Whitestown is a rapidly growing suburb in Boone County. Anson, a $1 billion commercial, retail and housing development, has widened Whitestown’s appeal with developers, employers and residents in the past few years.
Plans call for The Shoppes at Whitestown, a $50 million, 275,000-square-foot shopping center located within the 1,700-acre Anson development.
During the past 24 months, over 50,000 square feet of small-shop retail and restaurant space has been developed and absorbed. New inventory on the horizon makes Whitestown a suburb to watch.
Seeing the success of its neighbors, other suburbs such as Lawrence to the east, Greenwood to the south and Speedway to the near west side are finding ways to connect and sustain residents through mixed-use developments. The future looks bright all the way around Indianapolis.
— By Jacqueline Haynes, Senior Director, Cushman & Wakefield. This article first appeared in the October 2017 issue of Heartland Real Estate Business magazine.