Tishman Speyer, Mitsui Fudosan Launch SoCal Project
Tishman Speyer and Mitsui Fudosan America have begun construction on the 380,000-square-foot first phase of Bake Freeway Business Park, an industrial development in Irvine, Calif.
In December 2023, the partners acquired a 32-acre lot within the Great Park Neighborhoods mixed-use community in Irvine for the ground-up development. According to The Real Deal, the parcel traded for $145.9 million.
The project encompasses four industrial buildings ranging from 73,000 square feet to 203,000 square feet.
The first two buildings will be financed through an $84.8 million construction loan from JPMorgan Chase. Bake Freeway has direct access to the I-5 freeway and Greater Orange County.
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The Class A properties will feature 36-foot clear warehouse space, 25 dock-high doors and two ground-level doors. The building at 15700 Bake Parkway will span 176,337 square feet across 9.5 acres and feature 186 parking spaces, while 15800 Bake Parkway will cover 202,831 square feet on 10 acres with 287 parking stalls.
Orange County’s strong industrial market
In the third quarter of 2024, Orange County’s overall industrial vacancy rate was 5 percent, with total availability at 7.6 percent, according to JLL Senior Managing Director Steve Wagner.
Recent deliveries of industrial facilities contribute to county-wide availability, he told Commercial Property Executive.
“South County and West County have demonstrated robust absorption, with newly delivered buildings largely leased by Aerospace/Defense and third-party logistics tenants,” he said. “In contrast, the Airport Area and North County are experiencing prolonged lease-up periods for new developments.”
Given the tenant profile in Orange County, properties featuring heavy power, abundant parking and an elevated office-to-warehouse ratio are garnering the most significant interest and activity, Wagner added. Although Orange County has experienced subdued leasing velocity in 2024, he anticipates a potential market rebound in 2025, boosted by an uptick in active requirements.
“This optimism is underpinned by strong market fundamentals, including its infill characteristics, high barriers to entry for new development and a diverse, skilled labor pool,” Wagner said. He added that the new development pipeline has also decelerated considerably, which may help balance supply and demand dynamics.
In June, the joint venture acquired a 60-acre, fully entitled development site in Peabody, Mass., where it has plans to create a four-warehouse building development. In August 2023, the joint venture also acquired a last-mile warehouse and distribution facility in San Francisco’s Bayview submarket.
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