Local developer Terrence J Rose has received approval from the Livermore City Council to move forward with the development of a 60,000 square-foot spec industrial development in the East Bay’s Tri-Valley submarket.
The Tri-Valley, which consists of the cities of Livermore,Dublin and Pleasanton, has joined the rest of the Bay Area and the nation in an industrial boom as the pandemic boosted the fortunes of e-commerce and led to demand for warehouse and logistics space. A first-quarter report by Colliers showed the Tri-Valley’s vacancy rate for industrial dipping to 4 percent and asking rates jumping nearly 12 percent to $0.96 per square foot. The trends suggested continued strong demand came even with the completion of nearly 1.4 million square feet of new supply since the beginning of 2020.
Livermore is the hub for warehouse and distribution centers in the Tri-Valley area, with 95 percent of them in the city.
“The Tri-Valley industrial market continues to revel in the unbelievable success the industry has experienced during an otherwise challenging past two years,” the report said.
The vacancy rate should be even lower, according to a report by JLL.
The report claims that difficulties or lengthy timeline in obtaining permits of use and occupancy “are stymying leasing activity for distribution and last-mile users.”
A practical example is an undisclosed e-commerce company that put almost 1 million square-feet of vacant sublease space on the market in Hayward and San Leandro as they were unable to obtain an occupancy permit.
Despite moratoriums and use permits hampering transactions, there is no shortage of tenants in the market. Prospective renters are looking for more than 21.5 million square feet of industrial space in the East Bay, with about three quarters for distribution and the balance for manufacturing. The East Bay needs 13 million square-feet of inventory in addition to its current supply and pipeline, according to the report.
Rose plans a spec development on a 3-acre parcel at the intersection of Armstrong and Earhart streets in Livermore. The site would include about 56,000 square feet of warehouse space and approximately 4,000 square feet of office space. The proposal also includes onsite parking, landscaping and storm-water-treatment improvements.
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