(EDITOR’S NOTE: According to sources with knowledge of the transaction, the sale closed at $16.7 million.)
Rare in-fill opportunity located in the East Bay’s core industrial market with easy access to major airports, seaports, the interstate freeway system, and a dense population base
We are pleased to announce that we have acquired 14490 Catalina Street [in San Leandro], a 90,725-square-foot manufacturing facility situated on 4.49 acres of land.
Formerly a bakery manufacturing facility, the current tenant of the property will vacate upon its lease expiration in July 2021 at which point Dermody Properties will complete substantial interior and exterior improvements.
“This is a rare opportunity for Dermody Properties to acquire an in-fill, value-add industrial building in a market with limited opportunities to increase the supply of space,” said George Condon, West Region Partner for Dermody Properties. “Besides its central location, one of the building’s greatest strengths is its cold storage space. It’s expensive to build and in short supply. Companies supplying food to Bay Area consumers need more cold storage space.”
Jason Ovadia, Mark Detmer, Ryan Sitov, Eddie Shuai, Patrick Metzger and Andie Fezell of JLL presented the opportunity to Dermody Properties. Dermody Properties has also engaged JLL to market the property for lease.
The property is located in the Bay Area’s core industrial East Bay market with immediate access to Interstate 880, and it is less than a one-hour drive from the Port of Oakland as well as the Oakland, San Francisco and San Jose airports. With more than 7.7 million people in the Bay Area, customers will have access to multiple affluent population bases.
“The fact that this facility is food-production-ready makes it a highly desirable asset in the market given the growing demand from a last-mile perspective as it relates to home deliveries of groceries and meal prep kits,” said Tim Walsh, Partner and Chief Investment Officer at Dermody Properties. “Having the infrastructure in place for cold storage is a strong advantage in this market and in the industry, where the current demand can’t be met. This is an outstanding benefit for our customers, in addition to the property’s strategic location from a logistics standpoint.”
According to CBRE, the East Bay industrial market totaled more than 2.3 million square feet of absorption in 2020, more than doubling the net absorption of 2019. At the end of Q1 2021, the East Bay market has posted more than 1 million square feet of positive net absorption with a consistently low vacancy rate of 2.8%. The increase in warehouse demand is driven by a global shift in the e-commerce industry from the quality of goods to the speed of delivery supported by last-mile logistics.