Amazon pays $31M for 60 acres along Gilroy shopping center corridor

City had planned for a 400K sf industrial project before applicant withdrew

Amazon CEO Andy Jassy and the site at 1445 Pacheco Pass Highway (Getty, Colliers)
Amazon CEO Andy Jassy and the site at 1445 Pacheco Pass Highway (Getty, Colliers)

Amazon is on the move again in the Bay Area.

The Seattle-based company paid about $31 million to buy 60 acres of agricultural land in Gilroy, the area’s southernmost city, that had previously been eyed for a 400,000-square-foot delivery center and warehouse, according to the Silicon Valley Business Journal. Located at 1445 Pacheco Pass Highway, the property is next to three shopping centers anchored by Costco, Walmart, and Target.

Amazon paid almost 20 percent above the Machado family’s asking price of about $26 million. Commercial brokerage firm Colliers, which marketed the site for sale, declined to comment to the Business Journal. An Amazon spokesperson didn’t follow up on a request for comment. The deal was recorded in the Santa Clara County Clerk-Recorder’s Office on Dec. 22.

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The property is zoned to allow for retail, industrial, and research and development uses, according to Colliers. On Oct. 21, the Gilroy planning commission recommended that the City Council approve a plan by Panattoni Development Company to build a delivery center and a warehouse. The center alone could accommodate almost 200 full-time jobs, and project plans referred to it as a “last-mile” facility, which receives packages that are then sent out for delivery.

At a City Council meeting in November, some Gilroy residents and union officials expressed concern about the development’s impact on traffic, the environment and the city’s workforce, leading members to postpone voting until Dec. 6. At that meeting, they learned that Panattoni had withdrawn its proposal, the Business Journal reported.

Amazon’s purchase follows its acquisition of 66 acres of farmland for about $31 million in August 2020. That land, which Amazon bought through its data services division, is less than two miles north of its latest purchase. The city was reviewing an early-stage proposal for a 214,000-square-foot project on the 66-acre site as of May, the Gilroy Dispatch reported at the time.

[Silicon Valley Business Journal] — Matthew Niksa

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