Commercial real estate: OnTrac makes big North Bay courier hub expansion

[caption id="attachment_41481" align="alignright" width="350" caption="OnTrac leased this entire 50,000-square-foot south Petaluma building for expansion."][/caption]

As part of a ramp up of Bay Area service, Phoenix, Ariz.-based regional overnight package courier OnTrac is expanding its North Bay hub. The company in August leased the entire former 50,000-square-foot Scandinavian Designs distribution center at 3830 Cypress Drive in Petaluma. From one loading dock in 9,000 square feet at 374 Blodgett St. in Cotati, OnTrac will have seven dock doors and two grade-level doors, allowing the company to handle 60 percent more packages for its service area, nearly 400 miles of coastline from San Francisco to Oregon, according to Laura Peterson, marketing vice president.

Founded 20 years ago as California Overnight and focusing on moving escrow and other documents for professional services firms, OnTrac now serves various industries in seven Western states, adding Colorado in September, and has annual revenues of more than $200 million. The service doesn't deliver wine, according to Ms. Peterson.

OnTrac markets itself as a faster, less-expensive alternative to national couriers. The company has California hubs in Sacramento, San Jose, San Francisco and a new one in Menlo Park. The largest facility is a new 160,000-square-foot hub in Reno, Nev.

OnTrac currently has 15 employees plus independent contractor drivers at the North Bay hub and will be hiring five sorters (resumes: as well as more drivers ( for the Petaluma facility.

Jerry Angel of Cornish & Carey Commercial Newmark Knight Frank and Rick Keefer of Pacific Union International represented the building owner. John Kovaleski of Colliers International represented OnTrac.

In the past three months, a number of offers from expanding North Bay companies came in on the building, but most were looking for up to 30,000 square feet, according to Mr. Keefer.***

The Marin County Board of Supervisors on Tuesday could postpone until Nov. 15 a decision for the county to purchase part of a large San Rafael commercial property to be the new home for the Sheriff's Department and other emergency services currently located at the Civic Center to the south in San Rafael. On Sept. 13 the board postponed the decision until Oct. 4 to give staff more time to study the venture.

If the board decides to move forward with such a purchase, the supervisors will be considering whether to purchase the entire 328,000-square-foot office building at 1600 Los Gamos Drive in the Marin Commons two-building development for $30 million or 165,000 square feet of it for $24 million, as part of the purchase option agreement with owner CORAC LLC from earlier this year.

If the board chooses the partial purchase, CORAC would pursue a lot split, according to board documents. In studying the plan, county has released $100,000 of the $250,000 deposit since the April agreement was signed.

Should any sale move forward, escrow could close in 45 days, per the agreement, unless the either side of the deal decides to extend it for 90 days, according to David Spear, facilities planning and development manager. How much of the space county offices will occupy depends on forthcoming space planning and accommodating existing tenants in the building, he said.

Marin Commons has been a big piece of the the county's office vacancy rate for years, even before the current owner took it back in a 2009 foreclosure.

"A county deal at Marin Commons would absorb a big chunk of space," said Whitney Strotz, head of Cassidy Turley BT Commercial's San Rafael office.***

Fairfield-based developer, owner and property manager The Wiseman Co. acquired the 30,000-square-foot class A Westside Professional Building at 2480 Hilborn Road and an adjacent pad. It's the only zoned and approved office building site on the west side of Interstate 80, according to the company.

The building had been taken back by Sterling Savings Bank when the previous owner was unable to find enough tenants, according to Doyle Wiseman, chief executive officer. Current tenants on the ground floor are Fidelity Title Co., Richard Whittaker's law firm, and publicly traded Vitas Innovative Hospice Care.

"The price was severely depressed because of the previous owner’s inability to lease the property and the bank’s urgent need to sell," he said.

Without disclosing the actual amount, he said the property was acquired for less than half the $10 million-plus assessed value of the property.

Wiseman brokers are in talks with an undisclosed company to occupy the second floor.***

Groskopf Warehouse & Logistics found a large Napa Valley warehouse for its expansion. [See "Wine warehouser Groskopf plans expansion," Aug. 15.] The Sonoma-based company signed a three-year lease with Upvalley Associates LLC for 60,000 square feet at 801 Hanna Ct. in American Canyon with first right of refusal on the whole 101,000-square-foot former Western Wine Cellars warehouse, according to Groskopf's agents, Kevin Doran and John Rico of Keegan & Coppin. Bret DeMartini of Grubb & Ellis represented Upvalley in the Aug. 28 deal.***

Steve and Judy Mahrt, owners of Petaluma Farms, which produces Judy’s Family Farms organic eggs, are back to buying Petaluma office buildings and converting them back to industrial buildings for business expansion, according to local real estate sources.

In the first half of this year, the Mahrts purchased the 15,616-square-foot former Creative Leisure office building at 951 Transport with plans to convert it to egg distribution warehousing with a possible retail aspect. [See the May 31 commercial real estate column.]

On Aug. 9 Mahrt Family 2008 Trust purchased the former home of First California Mortgage Co., nearly 19,000-square-foot 939 Transport Way, from the Bergmann Family Trust for $1.375 million, or about $74 a square foot. Chris Castellucci of Keegan & Coppin represented the Bergmann family in the sale. Mr. Mahrt was not available for comment.•••

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