Intercontinental, Kennedy Wilson Buy Central Valley Asset for $72M

Intercontinental Real Estate Corp., in joint venture with Kennedy Wilson, has acquired Stockton Commerce Center, a fully leased 655,976-square-foot warehouse and distribution facility in Stockton, Calif., for $71.8 million.

The seller was not disclosed, but information from CommercialEdge indicates that the previous owner was a limited partnership affiliated with DRA Advisors. The same source stated that the Class B property was completed in 1988.

The property is on a 36.7-acre site at 1624 Army Court, immediately adjacent to an 877,648-square-foot manufacturing and distribution facility that the joint venture acquired in 2022.

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The Central Valley location is just off State Route 4 and only five minutes from the Port of Stockton and I-5. The two facilities are also served by Stockton Metropolitan Airport and several railways, including Union Pacific, BNSF and the Stockton Terminal & Eastern Railroad.

Jeff Chiate, Rick Ellison and Matt Leupold of Cushman & Wakefield’s National Industrial Advisory Group–West represented the seller.

Size matters

The Central Valley’s industrial space market has been marked in recent months by strong interest in spaces of 200,000 square feet or less, according to a first-quarter report from Colliers. In the meantime, a single tenant snapping up San Joaquin County’s two largest available spec buildings has left “no remaining options for anyone who needs space in excess of 1 million square feet.”

Colliers also reported that San Joaquin County currently has an overall vacancy of 7.3 percent on an inventory of 136.8 million square feet. Net absorption in the first quarter was 2.0 million square feet, and 3.1 million square feet were under construction.

In January, DRA Advisors and Rising Realty Partners acquired a 531,308-square-foot, six-building industrial portfolio in Stockton and nearby Lodi, Calif., for an undisclosed amount.