RK Logistics signs large lease in Fremont’s Kato Road industrial hub

Supply chain firm’s deal ranks as second biggest in quarter for Silicon Valley

RK Logistics' Joe MacLean and Link Logistics Luke Petherbridge with 47020 Kato Road
RK Logistics' Joe MacLean and Link Logistics Luke Petherbridge with 47020 Kato Road (RK Logistics, Link Logistics, Colliers, Getty)

Locally-based RK Logistics pre-leased more than 200,000 square feet of warehouse space at the Fremont Elm Business Center. The move was the second largest lease in Silicon Valley in the second quarter. 

RK Logistics is taking 209,000 square feet of warehouse space at 47020 Kato Road in Fremont, according to data from a Colliers market report. The center is owned by Link Logistics and expected to be completed later this year. The development is located on Kato Road which has become an industrial hub and features companies such as Tesla, Boston Scientific and Delta Electronics. Fremont currently has more than 50 million square feet of flex industrial space and supports the largest concentration of advanced manufacturing companies in the country.

Financial terms of the lease were not disclosed.

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RK Logistics provides warehouse and supply chain management services. It recently opened over a million square feet of industrial space in Hayward. The property has 12 facilities and is shared with Tesla. It also signed a 240,000-square-foot lease on Winton Avenue in Oakland

RK Logistics was just beat out by Tesla for the largest lease of the quarter. The electric car manufacturing powerhouse took 210,000 square feet of industrial space on Fremont Avenue in the same city.

The industrial/warehouse market in Silicon Valley was a bright spot in the region, according to the Colliers report. Gross absorption, a measure of the total volume of non-renewal leases and user-sales, increased 81 percent from the prior quarter and totaled 945,000 square feet. Asking rents averaged $1.45 per square foot and were up 6.6 percent for the quarter and up 9 percent year-over-year. While the current market is strong, barriers to entry in development could harm the market moving forward.

“Extended entitlement time frames, high land and building costs, and supply chain issues critical for building infrastructure may delay construction, and constricting future supply,” the report said.