By Jon Peterson
San Francisco-based Prologis has leased 3.3 million square feet so far at its International Park of Commerce development in Tracy, according to sources familiar with the development. Two recent leases have been signed in the development, one for one million square feet to Amazon and another with Smuckers for 400,000 square feet.
The other tenants in the project are Medline and FedEx, who both own their own buildings. Medline occupies 1.2 million square feet and FedEx 650,000 square feet.[contextly_sidebar id=”47EmjMhHFhpsYs5jYBN7E0OgtpmcPOwE”] The leasing efforts on the project are undertaken by Colliers International from the firm’s Oakland and Stockton offices. Greig Lagomarsino is leading the initiative out of the Oakland office, and Michael Goldstein and Gregory O’Leary work at the company’s Stockton office. Colliers and Prologis both declined to comment on any of the leases that have been signed in the Tracy project.
“The early success of the International Park of Commerce will continue and accelerate as large blocks of space are scarce along the I-880 corridor and demand remains robust,” said Lagomarsino. The project in Tracy is located 45 miles from the Port of Oakland.
Prologis is the sole owner of the International Park of Commerce development. It broke ground on the development in November of 2014. At that time, the development was owned by the publicly traded REIT and there was no interest held by any of the company’s third party investment management funds.
The entire development covers 1,800 acres. This project is the largest that Prologis has ever done in North America. It will have between 19 million to 20 million square feet at full built out.
Tracy has become one of the more favored cities in the broader Bay Area geography for industrial development, and the city itself has welcomed the action. In November of 2015, Denver-based DCT Industrial Trust had received final approvals on its 795,000 square foot industrial project in Tracy located at 8450 West Arbor Avenue. The publicly traded real estate investment trust is calling the project DCT Arbor Avenue.
DCT had seen similar market conditions in the San Joaquin Valley industrial market. “This region is very tight from an occupancy standpoint. The overall vacancy for this region is in the low single digits and demand for new space is strong,” said David Haugen, a vice president with DCT. He covers the Northern California region for the company and works out of the firm’s regional office in Emeryville.
Earlier in 2015, Ridgeline Property Group announced today that it was teaming with investment partner LaSalle Investment Management to develop Tracy Pescadero Distribution Center, a 381,600-square-foot, Class A regional distribution facility located in the same city.
“Tracy, California, is the best distribution location in the Central Valley, and the Tracy Pescadero Distribution Center will provide much-needed Class A space for modern distribution operations,” said Jim McLaughlin, partner with Ridgeline Property Group at the time. “There is virtually no availability of Class A space greater than 200,000 square feet in the Central Valley.”