Amazon Buys Gilroy Parcels for $31.2MM

By Meghan Hall

Amazon is continuing to grow its regional footprint, buying excess land on the Bay Area’s fringes in an effort to remain close to major population centers. In a deal that just closed, the e-commerce giant purchased vacant land in Gilroy for $31.2 million, according to sources familiar with the deal.

The acreage is located at 1445 Pacheco Pass Highway and is known as Rancho San Ysidro. An executive listing summary obtained by The Registry shows that the land totals 60 acres. It was on the market for $26.136 million, or about $435,600 per acre.

Colliers’ executive vice president John Machado represented Machado Family Partners in the sale.

“The Machado Family is very pleased with the new ownership’s plans to develop a distribution hub on the property. This will not only create jobs for the Gilroy community during the development and construction process but after the project is complete, providing efficient e-commerce solutions for Silicon Valley and beyond,” said Machado.

The Machado family originally inherited the farmland under the Williamson Act, also known as the California Land Conservation Act of 1965. The property has been in the family for three generations, during which time the land was removed from the Act and annexed to the City of Gilroy.

Marketing materials show that 28.40 acres of the property is zoned for retail and commercial uses, while the remaining 29.75 acres are zoned for R&D and industrial. The acres are close to Gilroy Crossing, anchored by Target and Kohl’s, as well as a Walmart Supercenter and Costco Wholesale. The land is also accessible via State Routes 101 and 152.

Amazon has not shied away from expanding its local presence; in October, it acquired a Milpitas office campus for $123 million. In September, the firm purchased undeveloped land in Pleasanton, Calif., for $75 million; Amazon plans to construct between 201,000 square feet to 520,000 square feet at the site. The project could operate either as a sorting station or delivery station.

On a broader note, Amazon has announced plans to 125,000 employees throughout the United States as it expands its logistics footprint, according to a fall statement from the company. The company also plans to hire 40,000 corporate and tech-oriented jobs. Over the course of the year, Amazon opened 250 new fulfillment centers, sortation hubs, regions air hubs and delivery stations. In September of 2021, it opened 100 new buildings alone and has hired more than 450,000 since the beginning of the pandemic.

West Coast Commercial Real Estate News