831,000sf Solano County e-commerce center sells to industrial real estate investor
It’s a sign of how much industrial real estate, particularly properties well-suited for e-commerce, are in demand.
The North Bay’s largest commercial building has sold even as the nearly as large second phase of the same Vacaville project is under construction for Amazon.
The 831,000-square-foot building at 700 Crocker Drive in the NorthBay Logistics Center development sold on Dec. 7 for an undisclosed amount, according to agents for the sellers. The buyer was Ranger Northbay LLC, an affiliate of DRA Advisors, and the seller was 700 Crocker Owner LLC, made up of LDK Ventures and PCCP.
“The North Bay and greater Bay Area has significant barriers to acquire and/or build new industrial product, based primarily on its limited and diminishing land base and difficulty in obtaining entitlements for new product,” said Andrew Briner, part of the Newmark real estate team the represented the sellers, in the deal announcement Tuesday. “Given the proximity to such a large pool of residents, Solano County has quickly emerged as one of the most desired big-box industrial markets in Northern California.”
Newmark’s Executive Managing Directors Andrew Briner, Bret Hardy and Jim Linn, Co-Head of U.S. Capital Markets Kevin Shannon and Vice Chairman Steven Golubchik represented the sellers, LDK Ventures and PCCP. Vice Chairman Ramsey Daya procured the financing on behalf of buyer, DRA Advisors.
The building had been a former Savemart distribution center, vacant for years, before it was purchased the 124-acre property in October 2017 for $34.1 million. LDK led the renovation of the building for multiple tenants, and it was leased to two North Bay companies for their e-commerce operations. Marin County’s Serena & Lilly leased 433,950 square feet, and Napa’s Wineshipping moved into 404,950 square feet.
LDK is developing the 36-acre second phase of the project, located at 4800 Midway Road. Construction started in early fall on a 617,000-square-foot distribution warehouse, and completion is scheduled for mid-2021.
“We are very pleased with the outcome on this sale transaction and it just further demonstrates the long-term strength in the fundamentals of the Northern California industrial market,” said Denton Kelley, managing principal of LDK Ventures, in the deal news release.
Amazon confirmed to the Business Journal that it will be occupying the building but didn’t elaborate on the use.
The Seattle-based e-commerce giant has been building out its logistics network elsewhere in the North Bay recently. Amazon this summer leased a 202,000-square-foot warehouse under construction in the Napa Logistics Park project in American Canyon. It’s designed as a “last-mile” delivery station, where sorted packages are loaded on small trucks bound for local destinations.
A similar facility is planned in the 250,000-square-foot Victory Station project south of the city of Sonoma, but that plan is being appealed.
A 322,000-square-foot warehouse was built for Amazon elsewhere in Vacaville in 2017.
This is DRA’s second North Bay acquisition this year and third locally so far. in January, one of the New York-based firm’s funds acquired two Petaluma light-industrial and warehouse buildings with 183,000 square feet at 755 and 775 Southpoint Blvd.
In 2011, a DRA Advisors fund acquired a 492-unit Petaluma apartment complex, called The Enclave at Adobe Creek, for $68 million.
All told, the firm’s funds own 542 industrial, retail, office and multifamily properties in 35 states, amounting to about $10 billion in assets under management, according to its website.
Most of the square footage is in industrial space — 52.8 million square feet in nearly 300 properties in 28 states, largely in Texas. The bulk of DRA’s California holdings are offices, totaling about 2.9 million square feet, while industrial holdings have just over 1 million square feet.
Also involved in the latest 700 Crocker sale were Newmark’s Bret Hardy, Jim Linn, Kevin Shannon and Steven Golubchik. DRA Advisors arranged its own financing. Brooks Pedder, John McManus and Tony Binswanger of Cushman & Wakefield have been marketing the project for lease.
Jeff Quackenbush covers wine, construction and real estate. Before the Business Journal, he wrote for Bay City News Service in San Francisco. He has a degree from Walla Walla University. Reach him at jquackenbush@busjrnl.com or 707-521-4256.
