Amazon offloads 137K sf industrial building in San Leandro

Deal with robotics startup marks second Amazon sublease in the East Bay city, totaling 431K sf

Arshan Poursohi, co-founder and CEO, Third Wave Automation, in front of 100 Halcyon Drive in San Leandro (LoopNet, iStock, LinkedIn/Arshan Poursohi)
Arshan Poursohi, co-founder and CEO, Third Wave Automation, in front of 100 Halcyon Drive in San Leandro (LoopNet, iStock, LinkedIn/Arshan Poursohi) has subleased two industrial buildings in San Leandro, including a new deal inked with a robotics startup.

The Seattle-based e-commerce firm has sublet the 137,000-square-foot building at 100 Halcyon Dr. to Union City-based Third Wave Automation, a manufacturer of autonomous forklifts, the San Francisco Business Times reported, citing unidentified sources.

In March, Amazon signed another deal to sublease the 294,000-square-foot building at 200 Halcyon Dr. next door to Dependable Highway Express, a West Coast trucking firm.

Amazon had applied in early 2020 to use the Halcyon property as an indoor delivery station, public records show. The combined subleases total 431,000 square feet. Terms of the 5-year deals were not disclosed. .

Third Wave intends to use the East Bay facility for advanced manufacturing, sources said. The startup has also leased a 25,600-square-foot building from Prologis in Union City. The company didn’t respond to a request for comment from the business journal.

In May of 2021, the company entered into a partnership with Toyota Industries, one of the world’s largest forklift manufacturers, to co-develop autonomous forklifts, TechCrunch reported. A few months later, it announced the closing of a $40 million Series B round with plans to hire employees and speed its product to market.

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Demand for advanced manufacturing and logistics space in the East Bay has reached historic highs over the last 18 months, driven by an influx of venture capital and changing e-commerce trends, according to the business journal.

Vacancy rates for warehouse, distribution and manufacturing space across Alameda and Contra Costa Counties were at 6 percent in the first quarter, according to data from JLL. Developers are now building 1.55 million square feet of industrial space in the East Bay region, a historic low.

Amazon made almost 1 million square feet of industrial properties available for sublease in the last quarter after spending the past few years steadily expanding its footprint across the Bay Area.

Most of that is in the East Bay, where it listed a 507,000-square-foot building in Hayward after failing to obtain occupancy permits. While Amazon intended to use the property as a last-mile delivery station, the city’s planning commission rejected its plans in March 2021.

The project wouldn’t have generated any direct sales tax revenue and would’ve had a “significant” impact on the city’s roadway infrastructure, Hayward’s acting principal planner said.

[San Francisco Business Times] – Dana Bartholomew

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