By Jon Peterson
San Francisco-based Prologis will be developing a 664,000 build-to-suit warehouse/distribution project in Tracy for mattress and bed manufacturer Zinus Inc. at the developer’s International Park of Commerce development in Tracy. The site for this project is located at the intersection of Promontory Parkway and Iron Horse Parkway.
The lease with the tenant in this building has a seven-year term, according to sources that are familiar with the project. “We are now in for permitting on the project, which could take about 30 days from now, and we are hopeful of complete the building at some time before the end of the year,” says Ryan George, a senior vice president with Prologis. He coves the northwest region for the company. He declined to talk about the lease term or the development cost of the build-to-suit as the company is still in the design review aspects of the property.
There were three companies involved in the leasing efforts on the property. Prologis was represented on this asset by Michael Goldstein, Greig Lagomarsino and Greg O’Leary of Colliers International. Colliers did not respond to inquiries seeking comment for this story. Zinus had Andrew Zink with T3 Advisors and David Scarpinato of Newmark Cornish & Carey work on the deal for them.
“We had our client look for six months all over the East Bay before we made a final decision on the site in Tracy. One of the attractions is that Tracy is a market where the cost would be half of what it would have been for a site in the I-880 Corridor in the East Bay, if you could find one. Another factor is that the executives of Zinus live in Danville and Pleasanton, and they don’t mind having to go out to Tracy,” says Zink.
Zinus is a company that manufactures and sells bedding and bedding products. “The build-to-suit will represent both a consolidation and expansion for the company. They are now in three buildings in San Leandro that total around 330,000 square feet. The leases in these buildings are a short term with all of them having less than two years left to run. The expectation is the tenant will be able to move into the property in Tracy by November/December of this year,” said Scarpinato.
The build-to-suit with Zinus is on around 30 acres of land. The office component in the building is planned to be around 20,000 square feet. Zinus plans to use the site in Tracy for its distribution of its products in the west region of the United States. It has an existing facility in South Carolina that handles its distribution efforts on the East Coast.
The International Park of Commerce development in Tracy for Prologis totals 1,200 acres. The developer so far has either started or completed four million square feet of space at this project. The long-range plan is the development at full buildout will total 19 to 20 million square feet. Prologis broke ground on this project in November of 2014.