By Meghan Hall
A big-name investor has purchased a San Jose business and industrial park, a property type that has remained popular despite the economy’s slowdown during the course of the COVID-19 pandemic. In a deal that closed last week, Black Creek Group acquired the Little Orchard Center in San Jose for about $96 million, according to The Mercury News. Black Creek Group paid for the property in all cash.
Property records list the former owner as a limited liability company affiliated with Oakland-based Harvest Properties.
The property encompasses 15.8 acres and four buildings that total around 690,000 square feet. Its addresses are: 1712-1792 Little Orchard St., 1810-1870 Little Orchard St., 170-198 Barnard Ave., and 189-1983 Stauffer Blvd. Tenants include Bittel Americas, which creates tech-based solutions for the hospitality industry, Atlas Compliance and Engineering, which specializes in product development, and Stericycle Specialty Waste, among others.
The property is in a heavily commercial part of San Jose, not far from an Amazon Hub Locker, Space Systems Loral and several shopping centers anchored by The Home Depot, Target Mobile and Best Buy. The property is just off of State Route 87 and is also within close proximity of the Santa Clara County Fairgrounds.
Bay Area industrial properties have fared particularly well over the past year. A second quarter market report released by JLL states that a “resurgence” in advanced manufacturing, for example, led to “record-breaking” quarterly absorption for Silicon Valley. The market recorded 2.3 million square feet of quarterly net absorption, with manufacturers and e-commerce tenants leading the way.
“After e-commerce related companies dominated leasing and touring activity for much of 2019 and 2020, the tenant mix in the market has diversified, marked primarily by the resurgence of advanced manufacturers,” the report states.
Vacancy across the market sits at 4.6 percent, with total asking rents reaching $1.28 per square foot. The market is expected to continue to compress as eager companies gobble up available space.