Tesla Signs Industrial Leases in San Jose and Fremont

Tesla is expanding its Bay Area industrial footprint with two major leases for regional operations and logistics.

The electric‑vehicle manufacturer controlled by billionaire Elon Musk has signed agreements for two large properties totaling nearly 375,000 square feet, according to commercial real estate firms Colliers and CBRE, Mercury News reported.

The larger lease covers a 267,100‑square‑foot facility at 49000 Milmont Drive in Fremont and is owned by a joint venture between Hines and Oaktree Capital Management. Located near Tesla’s flagship Fremont factory, the building is expected to support advanced manufacturing or component assembly, complementing the company’s existing production infrastructure.

Chip Sutherland and Vince Machado of CBRE brokered the transaction, which adds to a growing cluster of industrial sites Tesla controls in the East Bay. In January, the company leased a 107,000-square-foot R&D facility owned by Lincoln Property in Fremont.

The second lease involves a 107,700‑square‑foot building at 2256 Junction Avenue in North San Jose, owned by Prologis. City planning documents indicate the site will serve as a vehicle preparation and delivery hub, with capacity for several hundred cars and approximately 920 parking spaces, plus 117 additional stalls for employees and customers. Tesla plans to perform standard servicing and software updates at the facility, including tire replacement and minor repairs, before handing the vehicles over to buyers by appointment.

While the timeline for full operations in San Jose remains unclear, the dual leases show Tesla’s strategy of integrating manufacturing, logistics and customer delivery within the Bay Area’s industrial corridor, according to Mercury News. The company’s expansion comes amid a broader regional shift toward EV‑related industrial redevelopment, as landlords repurpose older R&D and warehouse properties for clean‑energy and AI tenants.

For example, Prologis is looking to develop data centers in the market, and Nvidia looks to build a 100,000-square-foot AI infrastructure facility at 300 Holger Way. North San Jose has also attracted Archer Aviation, a maker of electric flying vehicles, with a 105,000-square-foot lease at West Tasman Drive.

– Joel Russell