Bridge Industrial Lands $117M for Bay Area Project
Proceeds will fund the construction of a four-building campus.
Bridge Industrial has secured a $117 million construction loan for a four-building, 714,491-square-foot industrial project in San Jose, Calif., according to Santa Clara County records. Bank OZK issued the funds with First American Title Insurance Co. as trustee. The developer expects to complete Bridge Point San Jose in 2025’s fourth quarter.
Bridge acquired the 32.8-acre site for $134 million in 2021, leveraging an $81.2 million acquisition loan from Invesco. Plans at the time called for the demolition of the existing campus prior to constructing the new industrial park.
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Bridge Point San Jose’s buildings are set to measure 358,180, 202,735, 83,751 and 69,825 square feet. The two larger facilities will have 36-foot clear heights while smaller ones will cap at 32 feet. The park will have a combined 77 dock-high doors—with roughly half featuring mechanical pit-levelers—and six ground-level doors. Truck courts are slated to measure from 185 to 135 feet in depth. Parking will consist of 344 car and 99 trailer spaces in total.
The development is at 2150 Commerce Drive, less than 3 miles from the San Jose Mineta International Airport, as well as roughly 33 and 35 miles southeast of the Oakland and San Francisco international airports, respectively. The Port of San Francisco is about 48 miles northwest.
Bridge Industrial targeting infill assets
Bridge is continuing its strategy of targeting infill industrial assets in supply-constrained core markets ripe for redevelopment or capital improvements.
In July, the company kicked off the office-to-industrial redevelopment of Ryder System Inc.’s former headquarters, a 248,989-square-foot office building in Medley, Fla. The developer plans to raise a 326,448-square-foot speculative industrial campus in its place. Ryder sold its former head office to Bridge for $42.1 million in March 2023.
Bridge is not the only developer looking to reshape office spaces. Earlier this month, Lincoln Property Co. began to put plans into motion for redeveloping a 218,268-square-foot office building into a 254,000-square-foot industrial project in Tempe, Ariz., by purchasing the 16.3-acre site upon which the office asset rises for $18.3 million.
Bay Area industrial assets priciest nationwide
The Bay Area’s industrial investment volume reached $2.7 billion year-to-date through September, securing the second spot nationwide—behind Dallas-Fort Worth—according to a recent CommercialEdge report. The market took the lead nationwide for sale prices, with assets trading at an average of $476 per square foot through September, more than triple the $130 national figure.
The overall vacancy rate in the Bay Area stood at 7.5 percent at the end of the third quarter, 50 basis points above the national average. The supply-constrained market’s pipeline still had 3.5 million square feet under construction as of September, although this was significantly behind other Western regions, such as Phoenix (33.8 million), the Inland Empire (10.2 million) and Denver (7.6 million), the same source shows.
In July, Hines secured $120.3 million for the construction of a 636,000-square-foot industrial project in San Jose. Edenvale Industrial Park is slated for completion in 2025.
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