IRG Inks Full Building Lease at Central Valley, Calif., Industrial Property

Real estate development and investment firm Industrial Realty Group, LLC (IRG) recently announced the execution of a full building lease at the company’s 2201 Cooper Ave. project in Merced, Calif.

Representing significant absorption of one of the Central Valley’s premier manufacturing and distribution assets, this lease will have a regional agricultural manufacturer occupy 500,000 square feet of Merced industrial space within the larger North San Joaquin Valley industrial market.

Located on a nearly 43-acre lot, the property benefits from dual rail service from both Union Pacific and BNSF. It also offers an extensive manufacturing infrastructure; an on-site electrical substation; multiple interior and exterior rail spurs; and significant trailer and employee parking. Additionally, the building’s expansion capabilities make it uniquely positioned for large-scale operations.

Selected for its strategic location in California’s Central Valley, the property provides convenient access to several major population centers throughout northern and central California. At the same time, it benefits from proximity to major intermodal facilities and interstate corridors.

As such, the region continues to attract food processing, manufacturing, and distribution users seeking access to California’s workforce, agricultural supply chain and consumer markets.

“The execution of this lease demonstrates the continued demand for high-quality manufacturing facilities in strategic logistics markets,” said Justin Lichter, chief investment officer of IRG. “This property offers a rare combination of scale, rail connectivity, power infrastructure, and access to California’s agricultural and transportation networks. We are pleased to welcome our new tenant and look forward to supporting their operations for years to come.”

In May, the Central Valley, Calif., industrial market was looking at a 14.5% vacancy rate, which was nearly double the national average of 8.8% and the highest among Western U.S. markets surveyed for our monthly national industrial report. At the same time, California industrial space here asked an average of a little more than $7 per square foot to rent, whereas the average rate for lease deals signed during the previous 12 months was $8.35 per square foot.

At the start of June, roughly 6 million square feet of new industrial space was in development across the Central Valley market.