House Depot Pre-Lease 127K sf San Jose Industrial Undertaking

Rendering of 1953 Concourse Drive (House Depot, Overton Moor Properties) with Ted Decker (left) of House Depot and Timur Tessimer of Overton Moor Properties

House Depot, this yr on a warehouse leasing tier in Southern California, has expanded its industrial footprint northward into the Bay Space, the actual deal has realized.

The nation’s largest residence enchancment retailer has pre-leased Overton Moore Properties’ roughly 127,000-square-foot warehouse challenge at 1953 Concourse Drive, in response to two folks accustomed to the deal. Atlanta-based House Depot signed earlier this month, stated two sources, who declined to share the precise size of the lease attributable to privateness considerations however described it as long-term. Monetary phrases of the deal weren’t disclosed. Joe Kelly of Newmark, the challenge’s itemizing dealer, declined to remark.

The deal underscores House Depot’s place as the brand new bell of the ball for industrial builders because it adjusts its provide chain and goals to have extra items in storage close to prospects. Its gross sales took successful in the course of the pandemic as folks spent extra time at residence engaged on do-it-yourself initiatives and contractors noticed an uptick in repairs. Gross sales rose greater than 14 % final yr to achieve $151 billion in 2020, in response to monetary filings. House Depot grew its warehouse portfolio 16 % to about 88.5 million sq. toes in the course of the submitting reveals.

Not like, which takes a “lease some, purchase some” method to actual property, House Depot prefers to hire than its industrial area: It leases 95 % of its distribution facilities. Sure, the monetary submitting reveals.

Within the Inland Empire area of Los Angeles and Southern California, House Depot has signed greater than 4.5 million sq. toes of commercial leases to this point this yr, in response to public property information. the actual deal, This consists of a number of giant leases in Ontario.

Sources stated the retailer’s San Jose pre-lease features a challenge that shall be delivered a couple of yr from now. It’s the solely main warehouse growth underneath building on the north aspect of town and now solely a handful of warehouses are being in-built the whole metropolis.

The deal validated Overton Moore’s determination to enter San Jose with the $13.5 million acquisition of a 7-acre web site on 1953–1965 Concourse Drive. The property was occupied by an roughly 110,000-square-foot workplace and analysis constructing, which was 10 % leased when the developer bought it. It is situated within the metropolis’s Worldwide Enterprise Park, an industrial submarket close to North San Jose with about 1.3 million sq. toes and two BART stations with a 1 % emptiness fee on the finish of final quarter, in response to knowledge from industrial brokerage Newmark.

The positioning can also be two miles south of a House Depot retailer in neighboring Milpitas. The corporate has 5 shops in San Jose, though in response to its on-line retailer listing, the closest it has to a pre-leased challenge is six miles away.

A month after the Overton Moore buy, the Torrance, California-based developer agreed with town to demolish the Nineteen Eighties-era workplace and analysis construction and construct a single-story warehouse totaling roughly 119,000 sq. toes with an connected two-level workplace. submitted preliminary plans with a proposal to Which has 8,000 sq.ft. San Jose’s deputy planning director authorised the challenge in April, and Overton Moore started tearing down the event web site’s current constructing final quarter, in response to metropolis information and knowledge from industrial brokerage JLL.

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