By Meghan Hall
Facebook has expanded throughout the San Francisco Bay Area over the past year, securing large leases in Mountain View, Fremont and San Francisco throughout 2018. The company’s foray into the East Bay is now set to continue with the signing of a 225,679 square foot lease at the Morton Commercial Center in Newark, Calif., according to a Newark City representative. The industrial campus, owned by Gardena, Calif.-based Overton Moore Properties, will be delivered during the second and third quarters of 2019.
“Just in the course of the last nine months, we have been very thoughtful about understanding that we needed to grow outside of Menlo Park, and we wanted to do that in a strategic manner,” said Chris Hom, Facebook’s head of real estate and strategy planning, at a Burlingame meeting in August 2018. “We’ve taken down two significant sites in San Francisco, we have about a million square feet that we just signed in Fremont, another million square feet in Sunnyvale, 400,000 square feet in Mountain View, and again they all are representative of our willingness to expand our footprint.”
The 604,769 square foot development is spread over four buildings, ranging in size from 76,162 square feet to 225,679 square feet. Building 4, the largest, will be delivered first, with the remaining buildings to follow. The Morton Commercial Center is just outside the main tech corridor that runs down the San Francisco Peninsula from San Mateo to San Jose, but is still home to plenty of major home-name companies. The project is located near the Dumbarton Bridge, State Route 84 and Interstate 880. Numerous big-name companies are located in the area, including Tesla, Amazon, Nordstrom, Bay Advanced Technologies and Worldpac. For the remaining three buildings, Overton’s CEO Timur Tecimer said the company is targeting tenants both along the San Francisco Peninsula and the East Bay.
“Our leasing strategy is to really try to focus on users who are on the Peninsula and Silicon Valley,” explained Tecimer. “We have an extremely tight market with functionally-challenged buildings, so we’re trying to provide a value solution from a cost standpoint, a leasing standpoint compared to Silicon Valley as well as a superior product type.”
Tecimer was unable to confirm the tenant for Building 4.
The remaining buildings won’t be built-to-suit, according to Tecimer, and will be delivered in shell form. However, the design of the buildings includes indoor-outdoor workspaces, 100 percent solar roof capacity, 4,000 amp power capability and extensive vision glass and skylights. The spaces will be able to support a variety of manufacturing, automation, life sciences and research and development uses.
“We like to deliver the buildings in a shell condition,” said Tecimer. “We have found that companies like to come in and design their own space, and their own improvements. But we’re always delighted to help and assist them in building out.”
Overton bought the project site from Morton Salt in December of 2017 for more than $30 million. The industrial development at Morton Commons is one of the largest in the Bay Area, according to a CBRE 2018 market snapshot. Other large industrial and warehouse projects in the current construction pipeline include Fremont’s Pacific Commons, totaling almost 1.8 million square feet between its first phase and planned industrial center, and Richmond’s Bay Area Logistics Center, which will be 707,820 square feet. For the time being, however, the total Bay Area vacancy rate for industrial space remains low, at just 3.6 percent.