Spec Construction Signals Bay Area Industrial Renaissance | The Registry
Home
Current Issue
Advertising
3/25/14 12:52 PM
About Us
Search this site
Contact Us
Home
Commercial
News Releases
Residential
Contributors
Technology
Hot Lot
Finance
AEC
People on the Move
Calendar
Commercial
INDUSTRY News Pacific Urban Sells San Jose Apartment Complex for $36.4MM MARCH 24, 2014
San Carlos MixedUse TOD Project Placed on Hold
Spec Construction Signals Bay Area Industrial Renaissance
!
"
#
$
Newsletter Sign Up
Search this site
MARCH 23, 2014
POSTED ON MARCH 21, 2014 BY PUBLISHER IN COMMERCIAL, INDUSTRY NEWS
USAA Buys Foreclosed Industrial Assets in Stockton
SILICON VALLEY DEVELOPMENT FORUM
MARCH 21, 2014
Spec Construction Signals Bay Area Industrial Renaissance MARCH 21, 2014
Admiral Capital Docks in Santa Clara
By Joe Gose
MARCH 20, 2014
Industrial developers in the Bay Area are pursuing speculative construction on the most aggressive scale in more than a decade, rushing to sate demand from food and beverage distributors, e-commerce companies,
More BREAKING news
http://news.theregistrysf.com/spec-construction-signals-bay-area-industrial-renaissance/
CREW EAST BAY LUNCHEON
CONTRIBUTORS
McNellis: Don’t Cry for Page 1 of 5
Spec Construction Signals Bay Area Industrial Renaissance | The Registry
3/25/14 12:52 PM
Argentina
homebuilding suppliers and other users.
MARCH 11, 2014
Related Articles
McNellis: ePup
Cohen Financial Secures $12.73MM For 2 Industrial Properties in Bay Area 3 weeks ago Overton Moore Breaks Ground on $62MM Industrial Project in Fremont 4 weeks ago Colliers Industrial Brokerage Team Completes
FEBRUARY 19, 2014
A Great Year to Unlock Quality Deal Flow
Largest New Industrial Lease in Hayward in a Decade 2 months ago Zurich Buys First Industrial Asset in San Francisco 2 months ago
FEBRUARY 4, 2014
McNellis: A Great Year to Unload Crap
More than 1 million square feet of speculative warehouse space is slated for delivery in 2014 alone in the market, generally along the I-80/I-880 corridor from Richmond to San Jose, according to Colliers International. Developers could also break ground on up to an additional 3 million square feet along the corridor by the end of the year. Los Angeles-based Overton Moore Properties in February kicked off a substantial portion of that expected speculative development, breaking ground on a 700,000 square foot, three-building project in Fremont.
JANUARY 2, 2014
Makeover or Makeweight? SB 743 and CEQA Reform
FEATURED ARTICLES
DECEMBER 12, 2013
Among other speculative projects, Irvine, Calif.-based Goodman Birtcher recently completed a 375,000 square foot distribution building at the Oakland Airport Logistics Center, and a venture between American Realty Advisors and an affiliate of the McShane Companies is expected to deliver a 575,000 square foot distribution building in Newark’s Cherry Logistics Center early this year. Earlier this month, KTR Capital Partners and Sponsor Properties acquired a 30-acre site that could accommodate more than 515,000 square feet in the second phase of Pinole Point industrial park in Richmond.
!"#$%"&$'%(&)*( +*",&)-".*(/"*,0 1&.23 4*5.6".7(89:(;<8=(>(?233*.-$",:( 4*"&6.*@
KTR officials said in a statement that they would build speculative product on the site given the lack of available
A.*#
!*B&
modern industrial space, and ground breaking is scheduled for this summer. Despite the fact that developers haven’t unleashed such a significant speculative spree since the late 1990s, Greig Lagomarsino, an executive vice president in Collier’s Oakland office, isn’t concerned at this point about overbuilding. A busier Port of Oakland is driving some activity, he acknowledged, but e-commerce companies,
Latest News Releases New Opportunities Arise for Home Buyers in Select Metros;
http://news.theregistrysf.com/spec-construction-signals-bay-area-industrial-renaissance/
Page 2 of 5
Spec Construction Signals Bay Area Industrial Renaissance | The Registry
food distributors and other users want to locate closer to the dense Bay Area populace.
3/25/14 12:52 PM
Inventory Decreases in Bay Area MARCH 25, 2014
“The market is very healthy—demand is so strong that there just aren’t that many places to go,” said Lagomarsino, who along with another Colliers agent handled Pinole Point’s land sale and is leasing the second phase. “Nobody is moving out of the Bay Area. If anything, job growth is fueling the need for more warehouse space, more office space and more housing.”
Quattrocchi Kwok Architects Receives Prestigious Leroy F. Greene Design + Planning Award of Excellence for Mills High School Theater and Gymnasium MARCH 24, 2014
Indeed, new development on tap may not be enough. In its fourth quarter 2013 Silicon Valley industrial review, Cassidy Turley estimated that tenants were searching for 5.5 million square feet at the end of 2013 and expected that number to grow in the coming months. Amazon and electrical product distributor OneSource Distributors, for example, are searching for nearly 800,000 square feet
Curberry.com Launches Innovative New Portal That Matches the Lifestyle Needs of HomeSeekers With Their Perfect Neighborhood MARCH 24, 2014
between them, according to Jones Lang LaSalle. Additionally, Cassidy Turley noted that some 20 percent of warehouse product in the market was “substandard or functionally obsolete.” “A shortage of modern industrial product in the marketplace has thwarted growth in recent years, particularly when it comes to distribution users who found few existing options in the region and typically landed elsewhere,” the brokerage’s report said. “These new projects will likely lease quickly and have little negative impact on local vacancy levels.” Users absorbed almost 2.8 million square feet of industrial space in 2013 along the corridor north of Fremont, more than twice the net absorption in 2012, according to Colliers. Meanwhile, the average vacancy dropped 171 basis points to 6.3 percent in the fourth quarter of 2013 from the prior year, while the average asking rent climbed about 10 percent to 52 cents a square foot, on a triple net lease basis, over the same period.
William Lyon Homes Secures Prized Coastal California Infill Land Portfolio MARCH 24, 2014
San Jose State University Student Health and Counseling Services Building Award Winner MARCH 22, 2014
BNBuilders and GitHub HQ Team Win IIDA Award MARCH 21, 2014
Hawaiian Airlines Resumes Daily Nonstop Wide-Body Service Between Silicon Valley’s Airport and Honolulu MARCH 21, 2014
The central Silicon Valley submarkets to the south witnessed net absorption of 141,000 square feet in 2013, according to Cassidy Turley. The average vacancy rate in those markets—Sunnyvale, Santa Clara and San Jose— dropped to 7.1 percent in the fourth quarter of 2013 from 8.6 percent in the third quarter, and over the same period http://news.theregistrysf.com/spec-construction-signals-bay-area-industrial-renaissance/
Page 3 of 5
Spec Construction Signals Bay Area Industrial Renaissance | The Registry
3/25/14 12:52 PM
the average asking rent climbed a fraction to 53 cents a square foot. The speculative activity also is occurring alongside a brisk acquisition environment in part driven by industrial property users. In the fourth quarter last year, for example, five owner occupants bought industrial buildings along the I-80/I-880 corridor. Those deals included KZ Kitchen Cabinet and Stone’s acquisition of a 108,000 square foot warehouse in Hayward in December. Lagomarsino anticipates that users will continue to snap up properties as they become available, and landlords are beginning to take advantage of the demand. In January, officials with San Diego-based Westcore Properties
Industry Events
determined that disposing trumped leasing when it came to a 255,000 square foot warehouse in Fremont, and it
MAR
sold the building to a wholesale furniture manufacturer
Wed
26
for $20.8 million. “The market has picked up, and interest rates are still very attractive,” Lagomarsino said. “If it makes sense, companies that want to control their own destiny are
MAR
27 Thu
finding it to be a good time to buy. But the reality is that it’s
Share
Tagged American Realty Advisors, Bay Area, Cassidy Turley, Cherry Logistics Center, Colliers International, Fremont, Goodman Birtcher, Hayward, JLL, Jones Lang LaSalle, KTR Capital Partners, McShane Companies, Newark, Oakland, Oakland Airport Logistics Center, Overton Moore Properties, Pinole Point, Richmond, San Jose, Santa Clara, Silicon Valley, Sponsor Properties, Sunnyvale, Westcore Properties
Related
7:30 am - View Details Transbay: The Emerging Neighborhood 11:30 am - View Details BOMA San Francisco will host a March Membership Luncheon
difficult to find buildings to buy.”
Email and/or Print article:
5:30 pm - View Details IFMA Silicon Valley will host a monthly meeting called Eleven Core Competencies
5:30 pm - View Details RECON will feature a Sacramento Mixer MAR
29 Sat
APR
1
Tue
5:00 pm - View Details SPUR will hold a program and networking reception called Urban Resilience on the Ring of Fire 8:00 am - View Details ULI San Francisco will feature a Sneak Peek of Tour of Marlow 10:14 am - View Details NAIOP Silicon Valley Chapter will hold a Developing Leaders Mentoring Dinner
USAA Buys Foreclosed Industrial Assets in Stockton
Subscribe
View Calendar
4 days ago
http://news.theregistrysf.com/spec-construction-signals-bay-area-industrial-renaissance/
Page 4 of 5
Spec Construction Signals Bay Area Industrial Renaissance | The Registry
3/25/14 12:52 PM
Cohen Financial Secures $12.73MM For 2 Industrial Properties Overton Moore in Bay Breaks Area 3 Ground weekson ago $62MM Industrial Project in Fremont 4 weeks ago
Colliers Industrial Brokerage Team Completes Largest New Industrial Lease in Hayward in a Decade 2 months ago Zurich Buys First Industrial Asset Powered in San by Francisco 2 months ago
Socialize! Like Share
Tweet
16
0
7
10
CURRENT ISSUE
The Registry is an integrat-
SOCIALIZE
!
"
LINKS
#
Home Current Issue
ed Bay Area real estate news company. We provide broad and relevant industry
$
Search this site
coverage focusing on analysis, information gathering and breaking news in the real estate and related sectors.
Advertising About Us Contact Us
Š 2007 - 2014 The Registry. All rights reserved.
http://news.theregistrysf.com/spec-construction-signals-bay-area-industrial-renaissance/
Page 5 of 5