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San Francisco

Developer moves forward on 122K sf industrial building in South San Jose

InSite Property Group aims to build distribution warehouse with mezzanine offices

InSite Property Group's Trent Smith and 455 Pierce Road (InSite Property Group, Google Maps)
InSite Property Group's Trent Smith and 455 Pierce Road (InSite Property Group, Google Maps)

A Los Angeles self-storage developer has moved closer to building a 122,000-square-foot industrial building in South San Jose.

InSite Property Group, based in Torrance, is undergoing a limited environmental review for a warehouse and office project at 455 Piercy Rd., the Silicon Valley Business Journal reported.

Plans call for a light-industrial building that would include 116,580 of warehouse space and 5,000 square feet of offices east of Silver Creek Valley Road and the 101 Freeway, on the southeast edge of the city.

The warehouse, built on 14.25 acres, would include 17 loading docks and 42 parking spots for big-rig trailers, plus parking for 132 cars, according to the environmental study by the city. It will eventually include between 40 and 80 full-time workers.

InSite primarily develops and operates self-storage buildings, according to its website. But its proposed warehouse is intended for use as a distribution center or manufacturing site.

Approval is expected within three months. It’s unclear when construction would begin.

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The project comes amid a tight market for industrial space in the South Bay. Demand for such space outpaced supply by 1.2 million square feet in the first quarter, according to CBRE.

Although the vacancy rate for industrial space in Silicon Valley increased to 2.5 percent from 1.8 percent in the second quarter, the market remains one of the tightest in the country, according to a new report from Colliers.

With little new space expected to be developed soon, warehouse and manufacturing sites in excess of 100,000 square feet are in short supply.

In December, Houston-based Hines paid $62.25 million for a nearly 30-acre site in South San Jose, where it plans to build two industrial buildings totaling 404,000 square feet. Then it paid another $19.9 million last month to buy a lot next door.

[Silicon Valley Business Journal] – Dana Bartholomew

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