Bisnow Scoop: Major Pre-Lease In Fremont
We've learned that LA-based global food distributor JFC International signed a 173k SF, 15-year pre-lease lease at Milmont Commerce Center (and now we are very hungry for lunch).
We stopped by Lee & Associates' Oakland office to chat with Jesse Lucas, Victor DeBoer, and Andrew Stoddard, who repped owners Principal Real Estate Investors and Panattoni Development Company on the deal. The industrial facility will wrap up in April 2015. Rolling the dice on spec is a popular trend these days, they tell us. In fact, there is more spec industrial development happening now on the 880 Corridor than in the past 25 years, says Andrew, who used to work for Prologis. Amazon's monster pre-lease in Newark this year opened the floodgates for more developers to start moving dirt while waiting for tenants to come.
A pension fund client of Principal and Panattoni closed on the 9.26 acre site in February. (The former 51k SF building was recently demolished to make way for the new one.) Lee sold them on the City of Fremont's potential, citing rising rents and lack of competing buildings in the submarket (the trio joke they should work for the Chamber of Commerce). With Fremont being primarily an infill market, it was a rare opportunity to acquire a functionally obsolete R&D building on a large enough land site at a purchase price that enabled them to underwrite new construction. The move marked Newport Beach-based Panattoni's re-entrance into the Bay Area after about 15 years.
The building, rendered above, will act as JFC’s new NorCal distribution center at 48490 Milmont Dr. The lease will start in about a year, or Oct. 1. JFC will construct both freezer and cooler space within the building. The building will also feature 30’ ceilings, 22 loading docks, and an ESFR sprinkler system. CBRE's Bob Ferraro and Kenji Sakai represented JFC. We'll have more on Lee's take on the industrial market later this week.
