Black Creek Group Inks 450 KSF Inland Empire Lease
- Jun 22, 2020
Black Creek Group has brought its approximately 743,400-square-foot Agua Mansa Commerce Center in the high-demand Inland Empire to 100 percent occupancy with a new tenant agreement. The real estate investment management firm inked a deal for XPO Logistics to lease a roughly 447,200-square-foot distribution center in its entirety at the three-building industrial campus in Colton, Calif.
READ ALSO: COVID-19’s Impact on E-commerce
The single-tenant lease-up of an entire half-million-square-foot industrial building has long been par for the course in the Inland Empire, one of the tightest industrial markets in the country, and the call for accommodations has only grown stronger over the last few months, as it has across most of the U.S. “Demand for Class A facilities has accelerated due to an increased need for e-commerce services as a result of stay-at-home guidelines that were implemented during COVID-19,” Steve Young, a senior vice president of asset management with Black Creek Group, told Commercial Property Executive.
XPO will make its new home at 2163 S. Riverside Ave., a Class A facility sited on 21 acres near the intersection of I-10 and I-215 in the heart of the Inland Empire. The building, developed in 2017, also features approximately 1,600 square feet of office space. Daum Commercial’s Rick John, Ken Andersen and Gus Andros marketed the property on Black Creek’s behalf and represented the company in the lease transaction, while Mike Chavez of Lee & Associates and TPC’s Steve Shields stood in for the tenant. Black Creek has owned 2163 Riverside since it acquired the three-building Agua Mansa portfolio in 2018.
Hot competition gets hotter
In the Inland Empire, the average overall vacancy rate was a low 4.2 percent in the first quarter of 2020, and positive net absorption totaled approximately 4.1 million square feet, according to a report by Daum. More users are vying for more space and there’s no end in sight to the trend. “With the increased demand, industrial supply has become even more limited throughout the Inland Empire and we can only expect competition for space will cause pricing to be impacted,” Young said. And as the availability of developable land dwindles, many builders are pursuing transformation projects to accommodate demand. “More and more developers are taking older, functionally obsolete buildings and redeveloping them into desirable buildings for tenants that include adequate loading, an abundance of trailer and/or car parking, high warehouse clearance and enough power to operate their material handling systems,” he added.
Black Creek is doing its part to increase the pool of premier industrial offerings in the Inland Empire. The company will soon commence development of the 251,000-square-foot Perris Distribution Center III in the Inland Empire East and the 193,000-square-foot Fontana Logistics Center in the Inland Empire West. Both buildings are on schedule to deliver in the first quarter of 2021.