While the Covid-19 pandemic has had a chilling effect on the revenues of several local industries, leasing for industrial developments in the East Bay has heated up.
Along with other port locations like Seattle, New Jersey, Long Beach, Miami and Chicago, the market for industrial space along the I-880 corridor around Oakland is one of the hottest in the country right now, according to Bob Ferraro, senior vice president with commercial real estate brokerage CBRE.
Ferraro told me the biggest industry demand for these spaces comes from e-commerce — namely Amazon — but also retailers, the home improvement world and big grocery players, though he declined to spell out the exact companies in the market jockeying for the space.
CBRE has seen a high volume of industrial leasing over the past six to nine months, Ferraro said, with 15 under-construction buildings of more than 50,000 square feet from Richmond to Fremont. What’s more, developers from around the country such as Black Creek Group (Denver), Overton Moore Properties (Gardena), CenterPoint Development (Chicago), Duke Realty (Indianapolis) and Scannell Properties (Indianapolis) have all jumped into the East Bay fray, with San Francisco-based developer Prologis also joining in on the action.
Ferraro said companies are looking to lease space in the range of 200,000 to 500,000 square feet all the way north from Napa, out to Livermore and as far inland as Tracy. The demand makes such projects attractive to developers. Industrial space is also immune to the housing debates that often surround residential and mixed-use projects.