Following the continued strength of the industrial real estate market in Silicon Valley, a 253,440-square-foot building has been put up for sale in Fremont. The property, located at 42701-42735 Christy Street on 13.05 acres of land, is currently owned by Blackrock.
The asset is offered for sale by CBRE’s Ontario and San Francisco offices. The team marketing the property includes Vice Chairman and Managing Director Darla Longo as well as Vice Chairman Rebecca Perlmutter Finkel.
The building’s design allows future owners to accommodate single or multi-tenant configurations. The property further benefits from features that cater to both warehouse and manufacturing users with heavy power supplied and parking for 447 cars. Multiple access points are available for both trucks and cars as well as over fifty docks for high loading and 24-foot ceilings. The industrial building is located just off the US Interstate 880 and in close proximity to US Interstate 680, providing easy access to major transportation routes.
The property is 100 percent leased to two long-standing credit tenants, Sanmina Corporation and Benchmark Electronics of California Inc., who have occupied the premises for the last 19 years. Current owners have benefited from an average of 14 percent annual rent growth since 2015 among low vacancy rates of 1.5 percent in the Fremont area.
According to the Kidder Mathews fourth quarter of 2022 Market Trends Silicon Valley Industrial Report, the availability rate in the area increased from 2.4 percent in third quarter 2022 to 2.5 percent in fourth quarter 2022, whereas the warehouse availability rate increased from 3.3 percent in third quarter of 2022 to 3.7 percent in the final quarter of the year.
Total sales volume increased substantially quarter-on-quarter from 101,000 square feet to 4.5 million square feet for industrial space, while the sales volume of warehouse space fell by 55.7 percent from 209,398 square feet in third quarter 2022 to 92,858 square feet in fourth quarter 2022.
Kidder Mathews further states that industrial jobs increased both quarter-on-quarter and year-on-year in the San Jose-Sunnyvale-Santa Clara metropolitan area. The transportation and warehouse sector increased 2 percent quarter-on-quarter and 3.3 percent year-on-year to 123,400 jobs, while the manufacturing sector increased 0.4 percent quarter-on-quarter and 3.2 percent year-on-year to 176,400 jobs.
The Silicon Valley industrial market continued to demonstrate strength with 260,643 square feet of warehouse deliveries in Fremont and 862,697 square feet of industrial construction completions in Campbell, San Jose, and Santa Clara. Low vacancy, high construction, and rental-rate growth in industrial markets has led to the sector becoming more competitive. Smaller users such as e-commerce startups are turning to co-warehousing, where they lease “end of life” properties and share it with other tenants, Kidder Mathews report concludes.