The 628,713-square-foot high-capacity perishable distribution center is set for summer 2020.
SHAFTER, CA—Demand for industrial space in densely populated areas of the Bay Area has increased exponentially in recent years as e-commerce companies maximize efficiencies by putting warehouse locations near consumers. A recent example is Graycor Construction Company, which has topped out on the construction of a 628,713-square-foot high-capacity perishable distribution center for one of the world's largest retailers.
The project broke ground in October 2018, and features interior elements such as a 73-foot tall high-capacity automated storage and retrieval system that will be in place by the building's delivery date of summer 2020.
"The combination of the cold storage construction, utility infrastructure, seismic design, and building and technology requirements for the ASRS make this the most sophisticated cold storage distribution complex we've ever built," says Roger Sautter, Graycor construction manager. "The future of this market is centered around designing and building efficient high-capacity automated distribution centers."
The 63-acre site includes the 84-foot tall distribution center, and facilities for truck maintenance and fueling, pallet processing, hydrogen farm for battery charging, a generator farm, and onsite fire pumps and tanks. The distribution center includes multiple perishable spaces with future expansion capabilities, 83 loading docks, an energy center and a single-story office. The automated storage and retrieval system is designed to maximize automation of the distribution center processes.
The automated storage and retrieval system vendors are now installing equipment. Graycor will be focusing on completing the rest of the perishable spaces in sequence, the site paving, the various out-buildings and the landscaping during the next few months.
The facility is centrally located in the San Joaquin Valley to service the western region. The Fortune 500 client selected this site because of its access to the high population areas in central California.
"With the increase in cost and limited available coastal land, the Central Valley region of California is one of the largest growing inland hubs for distribution, offering a low-cost inland location with good coastal access," Daren Sealover, project executive, Graycor Construction. tells GlobeSt.com. "The rise in e-commerce and enhancing the last mile experience has also been one of the driving forces for increase in warehouse and cold storage development around the country's largest metropolitan areas. More and more facilities are being equipped with automated storage and retrieval systems. These high-capacity distribution centers, such as the facility Graycor is building in Shafter, CA, have the ability to supply conventional and e-commerce retail centers in the heavily populated coastal areas of central and Southern California."
Graycor's portfolio in the cold storage and distribution center market includes work with ALDI Inc., Walmart, Amazon, FedEx Ground, Prologis, Seefried Industrial Properties and Liberty Property Trust.
The overall vacancy rate for the San Joaquin County industrial market increased slightly at mid-year 2019 by 50 basis points to 6.1%, while the countywide direct vacancy rate registered 5.5%, according to a report by Colliers International. The increase in vacancy can be attributed to three large industrial facilities that became vacant during the second quarter totaling 633,404 square feet.
Gross absorption for the second quarter of 2019 totaled more than 2.7 million square feet with net absorption year-to-date of more than 1 million square feet. Large industrial users that occupied space during the quarter include Tesla, Pflug Packaging, Prism Logistics, Best Logistics, Katerra and McCollisters Transportation.
A total of 12 industrial development sites are currently under construction throughout San Joaquin County totaling close to 6.3 million square feet of industrial product that will come to the market during the next 12 to 24 months. The San Joaquin County industrial market added three industrial buildings during the second quarter totaling more than 1.7 million square feet. Of the three facilities, only one will bring available space to the market as the other two were either pre-leased or build-to-suit, says Colliers.
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
