Northern California's largest contiguous warehouse, with over 19 acres under one roof, the former Savemart distribution center in northern Solano County is in new hands as part of a $31 million sale.
It's a joint venture between Los Angeles-based real estate investor and financier PCCP, LLC, and Sacramento area's LDK Ventures, LLC. Together, they purchased the vacant 843,248-square-foot cross-dock warehouse at 700 Crocker Drive in Vacaville last month.
"Inventory in the entire North Bay for warehouse is very tight, and there is now little available over 100,000–200,000 square feet," Denton Kelley, managing principal of LDK (ldkventures.com), told the Business Journal. "… There is not much land you can pick up at a price that it makes sense to build (industrial space) on."
Across the Bay Area, vacancy in the industrial real estate market is less than 5 percent and is "extremely supply-constrained," said Jim Galovan, a partner with PCCP (pccpllc.com), in a statement.
That's why the company said it is backing the purchase and planned renovation of the Vacaville building and a year ago loaned LDK $48.5 million to build a 707,600-square-foot Richmond distribution center, which is set for completion this fall.
Vacaville has a lot to offer businesses seeking a new or secondary location in Northern California, said Mayor Len Augustine in a statement. It's nearly half-way between Sacramento and San Francisco on Interstate 80, and has access to the Central Valley via Interstate 505 and to the East Bay via interstates 80 and 680.
“Vacaville is poised to be the premier manufacturing center in Solano County, and this transaction moves us closer to that goal,” Augustine said.
Vacaville recently approved a $2.5 million loan from development impact fees to extend the water system in the Interchange Business Park, an area of the city bordered by Interstate 505, Vaca Valley Parkway and Midway Road. Completing the project will allow 258 acres in the park to be developed, according to the city.
"We're working on wine storage deals in Vacaville," said Brooks Pedder, part of the Cushman & Wakefield team that listed the 700 Croker for sale and is now marketing the space for lease.
The 700 Crocker warehouse and its truck-staging pavement covers 75 acres and was built in the late 1970s.
"Modern warehouses have 186 feet deep of paving for truck storage, and this building has 300 feet," Kelley said. "It's a differentiating feature."
The warehouse has 30-foot clear height for vertical storage, three-bay truck-maintenance facility and a 30,000-square-foot cross-dock sorting facility with 32 dock-high truck doors.
The building is being configured and renovated to accommodate a single tenant or up to four, with spaces available as small as 174,000 square feet. The warehouse hasn't ever been painted on the outside, so it and the inside are set to get a modern touch, Kelley said. Paving will be repaired, offices and restrooms updated, some of the truck dock doors redone and, perhaps, a new monument sign at the entrance.
The building is part of a 124-acre development called North Bay Logistics Center. It's located just north of the junction of interstates 505 and 80.
North Bay Logistics Center is configured for another large warehouse, with 600,000 square feet. LDK is working on entitlements for a 500,000- to 600,000-square-foot cross-dock warehouse, likely to be built before preleasing, Kelley said.
LDK has experience with master-planned communities, "brownfield" sites with needed cleanup, adaptive reuse and turnarounds on value-add and distressed real estate. The company is renovating McClellan Air Force Base just north of Sacramento into a 3,000-acre mixed-use campus and is undertaking The Railyards 244-acre urban infill project downtown.
The company's portfolio currently includes about 10 million square feet in Northern California, including 8.5 million square feet of aging space at the former base, now called McClellan Park.
LDK continues to look for industrial real estate opportunities in the North Bay and the rest of the San Francisco region, Kelley said.
The deal between sellers Lucky NoCal Investor, LLC, and Lucky Stores Properties, Inc., and the buying entity, 700 Crocker Owner, LLC, closed Sept. 18. Brooks Pedder, Tony Binswanger and John McManus of Cushman & Wakefield represented the sellers.
PCCP was started in 1998 and said it has raised, invested, and managed more than $14 billion in institutional capital and currently manages over $7 billion in assets.
Jeff Quackenbush (email@example.com, 707-521-4256) covers the wine business and commercial construction and real estate.