A sequence of main specials and assignments introduced this month in San Diego’s Otay Mesa neighborhood, which includes two of the biggest profits of the past decade, underscore mounting industrial demand from customers in components of the U.S.-Mexico border region.
Chicago-based mostly LaSalle Investment Management acquired an industrial house spanning extra than 601,000 square feet, constructed in 2003 at 2020 Piper Ranch Highway, for about $126.8 million or $210 for each square foot, in accordance to community filings and brokers who managed the offer. The vendor was Los Angeles-centered financial commitment organization Ares Administration, which procured the property in November 2020 for around $109 million or $181 for every sq. foot.
Also developers Majestic Realty Co. and Sunroad Enterprises introduced the complete-making pre-lease of their 240,975-sq.-foot property less than design at 1610 Landmark Street, to logistics expert services supplier R.L. Jones Customhouse. Pricing was not disclosed.
Need is escalating from providers, together with R.L. Jones, hunting to develop their distribution presence in the U.S.-Mexico border region as they react to e-commerce requires and relocate logistics functions to domestic areas in reaction to overseas supply chain disruptions.
“The response from the tenants to this product or service and this place as been quickly and obvious,” Majestic Realty Vice President Tom Simmons mentioned in a assertion, pointing to reasonably rapid lease-ups at the Landmark improvement and also its nearby Majestic Sunroad Center in Otay Mesa.
Otay Mesa is amid San Diego’s premier industrial hubs and has been a single of its most energetic for new improvement and leasing all through the previous 10 years. The community has 1.6 million sq. ft of industrial tasks less than development, the most of any San Diego enclave, according to CoStar facts.
The Piper Ranch Road sale, involving one particular of San Diego’s greatest current industrial properties, was among the most significant of the past decade by total price tag, according to CoStar and general public info. The Landmark Road leasing was Otay Mesa’s most significant non-Amazon industrial lease deal by square footage of the previous ten years and San Diego’s biggest in the previous 5 several years, according to brokerage Colliers International, which represented the landlords.
Developers and brokers explained R.L. Jones will be relocating its company headquarters from another San Diego house as its expands its current presence at the Otay’s Landmark industrial park to a complete of 400,000 sq. ft. The company’s new lease requires a building that is slated for completion in Might 2023.
The a short while ago sold Piper Ranch Street making is fully leased to logistics and production tenants which include QS Customs Brokers, Atlas Freight Forwarding and Balboa H2o Team. Brokers at Cushman & Wakefield, which represented the seller, claimed the 31-acre assets captivated likely customers with its proximity to the U.S.-Mexico border and 1 of the world’s busiest worldwide land border crossings concerning Otay Mesa and Tijuana, Mexico.
“Surrounded by a number of big corporate neighbors, the project is centrally positioned within the Otay Mesa submarket that providers a broad assortment of tenants both equally related to cross-border enterprise and San Diego providers seeking for really useful industrial area,” Cushman & Wakefield Vice Chairman Bryce Aberg mentioned in a statement.
In the very same community, developer Elevation Land Co. last 7 days announced ideas to make a 1.8-million-square-foot industrial campus referred to as Otay Enterprise Park. The speculative challenge, planned to inevitably contain 5 properties, is currently being built in a joint undertaking with a true estate fund advised by Crow Holdings Capital, according to a statement from builders and Cushman & Wakefield, which is managing leasing.
Builders last yr acquired a complete of 263 acres of land for $165 million for the undertaking off By means of De La Amistad Street in close proximity to point out Route 905, with the initially stage of properties to be finished in the next fifty percent of 2024. Brokers stated the project at total buildout would be amongst the greatest industrial campuses in Southern California.
CoStar Sector Analytics info as of Feb. 13 confirmed Otay Mesa’s industrial vacancy charge historically limited at 4.4%, and the community noticed rents increase 12.5% for the duration of the previous year. The community experienced 1.4 million sq. toes of favourable internet absorption in excess of the past 12 months — much more room getting loaded than vacated — and $487 million in industrial assets gross sales, up 37.4% from the prior yr.
In the Piper Ranch Street creating sale, the seller was represented by Jeff Cole, Jeff Chiate, Bryce Aberg, Rick Ellison, Mike Adey and Zach Harman of Cushman & Wakefield. The customer was self-represented.
In the Landmark Road leasing, the landlords were being represented by Mark Lewkowitz, Chris Holder and Will Holder of Colliers Global. The tenant was represented by Regan Tully of Cushman & Wakefield.