Vacant South San Jose Site Bought by Prologis

Prologis is taking ownership of a vacant San Jose site previously proposed for light industrial development.

The San Francisco-based industrial real estate giant acquired the 14.2-acre property at 455 Piercy Road for $14 million, the Silicon Valley Business Journal reported, citing Santa Clara County Clerk-Recorder’s Office records. The site last sold in 2021 for nearly $4.8 million.

In 2022, previous owner InSite Property Group floated erecting a light industrial building on the site. The project would have included 116,580 square feet of warehouse space and 5,000 square feet of office space. That effort appears dead in the water. InSite’s development permit is poised to expire by the end of the year, but the new owner could apply to extend it, the Mercury News reported. Prologis has not disclosed its plans.

The land, now under Prologis’ stewardship, sits within an industrial hotspot in south San Jose. The area has nearly 24 million square feet of industrial space, per Cushman & Wakefield data cited by the Business Journal.

The purchase doesn’t mark Prologis’ entry into the neighborhood. The firm owns a 111,700-square-foot logistics property at 6212 Hellyer Avenue and a 302,772-square-foot industrial warehouse at 5853 Rue Ferrari. Prologis reigns as the top commercial property owner in Silicon Valley with more than 13 million square feet.

Last fall, Prologis set the record for the largest warehouse and distribution space transaction with an 11-building purchase at Crocker Industrial Park in Brisbane. Prologis picked up the nearly 1-million-square-foot portfolio for $314.5 million, or about $330 per square foot, marking the largest such deal of the year by both price and size. Prior to the acquisition, Prologis owned 13 buildings at the Crocker complex totaling more than 500,000 square feet.

Prologis has been pursuing development opportunities in the Bay Area in addition to property acquisitions. Earlier this year, the logistics giant floated plans to redevelop the Caltrain railyards along Townsend Street in San Francisco’s South of Market neighborhood with approximately 2,500 homes and 4 million square feet of commercial space. Under the proposal, the 20-acre site around the Fourth and King Caltrain station would become a dense mixed-use district with office and retail space and potentially a hotel. The railyards have been targeted for redevelopment for more than a decade, but Prologis and Caltrain began more seriously exploring redevelopment opportunities in 2021.

— Chris Malone Méndez