By Jon Peterson
San Francisco-based Prologis has paid $6.7 million, or roughly $188 per square foot, to acquire the 35,600 square foot industrial property located at 1616 to 1622 Doolittle Drive in San Leandro, according to public records. The buyer would not comment on what it paid for the property.
Prologis, one of the world’s largest industrial real estate investment and holding companies, has plans in the future to expand the property by an additional 80,000 squarer feet in a market that is constrained by product supply and a continuously growing population. “The property that we just closed on in San Leandro has solid current income that will allow us to take it through entitlements to make it a larger asset in the future,” says Darren Kenney, a vice president investment officer for the Western Region for Prologis.
The industrial building now is 100 percent leased to four industrial/retail customers. These companies use the current space to move their products around throughout the Northern California region. At this time, Prologis has not established a timetable established on the entitlement process, but certainly the in-place rents offer the company flexibility in timing of that decision.
Prologis has been active in the San Leandro industrial market for some time given its geographic significance in the broader Bay Area economy. “The San Leandro market is a very strong industrial location. It’s right along the I-880 Corridor and is in close proximity to the San Francisco Bay Area. The market has much more demand that there is supply to accommodate the demand. This is shown by the industrial market in San Leandro having current vacancy of less than one percent, and rents have been steadily increasing over the past couple of years,” said Kenney.
Prologis has the greater San Francisco Bay Area as one of its target markets. The public REIT has an interest of either buying existing assets or acquiring land for new development opportunities.