Tesla rival Lucid Motors expanding in Newark.
Facebook is expanding further south into central Fremont area.
For people who can’t get past the paywall.
ok… not too hot here
but this deal is unusual because it’s industrial space where the company plans to prepare food for its expanding Menlo Park headquarters, according to sources familiar with the deal.
Exclusive: Facebook inks big lease in East Bay to feed its growing workforce
Blanca TorresJan 11, 2019, 3:21pm PST
Timur Tecimer, CEO of Overton Moore.
Todd Johnson | San Francisco Business Times
Facebook signed yet another large lease in the East Bay in an under-construction development in Newark.
The social media giant leased 225,679 square feet in the Morton Commerce Center, a 605,000-square-foot industrial park on the site of a former Morton Salt factory off of Central and Morton Avenues in Newark.
A rendering of the Morton Commerce Center, a four building, 605,000 square foot industrial project in Newark.
Overton Moore Properties
Facebook has leased more than 2.1 million of offices space in the Bay, but this deal is unusual because it’s industrial space where the company plans to prepare food for its expanding Menlo Park headquarters, according to sources familiar with the deal.
“Facebook is excited to join the community in Newark," said Kyle Gerstenschlager, a spokesperson for Facebook. "We’re committed to being a good neighbor and having a positive impact here. We will start on day one by bringing new jobs and opportunities to the city.”
“This is a very unique situation in which Facebook has an approach of creating a village atmosphere to provide for the needs of their employees,” said Terrence Grindall, Newark’s economic development director. “It shows how centrally located Newark is.”
During non-peak times, it’s a 12-minute drive from Newark and Facebook’s Menlo Park base, he said. This is Facebook’s first foray into Newark, but the company has shown interest in leasing other properties. Facebook has also taken a lead in efforts to add a light rail line over the Dumbarton Bridge that connects Menlo Park to the East Bay.
City officials worked closely with the developer of the project, Los Angeles-based Overton Moore Properties, to entitle the project in less than six months so construction could start late last year. Facebook was already in the wings as a possible tenant when Overton proposed the project, Grindall said.
Facebook will occupy one of four buildings in the Morton Commerce Center that will be complete in July. The rest of the project will wrap up construction by September. Grindall said the entire development is expected to accommodate about 600 workers.
Timur Tecimer, CEO of Overton, declined to disclose the name of the anchor tenant of its Newark development, but did say that many technology companies are looking at industrial space in Newark, Fremont and Milpitas areas.
Technology companies based in Silicon Valley don’t have a lot of options for industrial space close to their headquarters, so they have to “migrate over the Dumbarton Bridge,” he said.
Overton Moore bought 29 acres from Morton Salt in December of 2017 for more than $30 million. The company is also building the 1.7 million-square-foot Pacific Commons South in Fremont. The firm previous built the 700,000-square-foot Crossings @ 880 in Fremont and 300,000-square-foot Gateway Marina in San Leandro, which are both fully leased.
“Morton Commerce Center is a next generation manufacturing/industrial project that will stand out from the aging existing building stock,” said John McManus, a Cushman & Wakefield broker who is handling leasing for Overton, in a statement. “The first lease at the project is a great example of how the project fits the market.”
Technology tenants are often looking for advanced manufacturing spaces to assembly products. Last year, Apple Inc. leased up nearly 314,000 square feet of industrial manufacturing space at McCarthy Creekside, a new development in Milpitas.
Demand for Bay Area industrial space is coming from three growing sectors: ecommerce and consumer goods companies, technology companies and food, either for production or distribution, said Kevin Hatcher, an Oakland-based industrial broker with CBRE who was not involved in the Facebook lease.
“As tech companies grow their footprints in the Bay Area, there are ancillary needs for industrial space,” Hatcher said.
Rents for warehouse and manufacturing space doubled in the past four years, he said, and developers are building millions square feet of new space. Many projects might start without tenants, but tend to lease up quickly.
“It’s easier for many tenants to lease a new building with upgraded infrastructure and build it out to fit their uses,” Hatcher said.
See, that stretch (Union City, Newark and Fremont) was bound to be found…