CA Ventures Chases Rising Demand for Logistics Space With Proposal To Revamp Waterfront Property in Richmond, California
One of the nation’s most concentrated industrial neighborhoods is growing as developers scramble to assemble whatever land they can to meet demand for warehouse and logistics space.
Chicago developer CA Ventures is the latest to throw a proposal into Richmond, California’s construction pipeline with plans to overhaul a vacant waterfront property into a high-end industrial complex, according to a design review application filed with the East Bay city. The project would include demolishing the existing structure at 1411 Harbour Way S at the Port of Richmond and building an industrial complex with nearly 202,500 square feet of space.
The roughly 8-acre site is owned by the city of Richmond, according to public records and CoStar data. However, the city signed a 26-year lease agreement in 2020 for a portion of the port’s terminal with a joint venture group that included Orton Development, an Emeryville, California-based firm with a long track record of complex rehabilitation and redevelopment projects. As part of the lease deal, the city agreed to include up to about $10 million to restore what city officials described as a “degraded” property, which was built in the 1970s.
“This long-underutilized City of Richmond port property is perfectly positioned for distribution or manufacturing use and will contribute to the social and economic growth of the surrounding area through job creation and revenue generation,” CA Ventures Executive Vice President William Lu said in the statement. The developer did not provide additional details about the proposed plan or its potential timeline.
It isn’t clear whether CA Ventures will team up with Orton or take over the project entirely. Orton did not respond to CoStar News’ requests for comment.
Though significant, the Richmond project will be a drop in the bucket alongside the city’s supply of more than 17.7 million square feet, according to CoStar data, an amount that makes it one of the most concentrated industrial markets in the country.
Throughout the East Bay — the Bay Area’s largest industrial market — a recent surge of developments has boosted the region’s stock at the fastest pace since the late 1990s, according to CoStar data. More than 2 million square feet of industrial space was completed in 2021, adding to the nearly 5 million square feet completed in 2020, the highest annual total since 1998.
Even with the additional supply, year-over-year rent growth has hovered around 7% for the past decade and is now settled at nearly 7.2%. What’s more, the average vacancy rate for industrial properties scattered across the East Bay stands at a little more than 4%, according to CoStar data, well below the 10-year historical average of 6.2% and down significantly from peaks of more than 12% reported at the height of the Great Recession.