VF Corp. Inks 817,000-SF Industrial Build-to-Suit Lease
July 14, 2005
SAN DIEGO/VISALIA, CA-For its MidState 99 Distribution Center, the San Diego-based developer Allen Group has landed an 817,000-sf industrial build-to-suit lease deal. The tenant is a subsidiary of publicly held VF Corp., one of the world’s largest apparel companies.
“We’re very bullish on the San Joaquin Valley for big box distribution,”says Richard Allen, CEO of the Allen Group. He tells Globest.com that the area’s seen a paradigm shift in the past five years with Wal-Mart, Target and IKEA all agreeing to occupy million-plus-sf centers in the region, a big leap from the area’s agricultural roots.
MidState 99 Distribution Center is a 400-acre master-planned rail-served industrial development located on Highway 99, 45 miles south of Fresno, which is about midway between Los Angeles and San Francisco.
The new building being developed by Allen Group will be the Western distribution hub for VF Corp’s outdoor apparel division. The facility will feature 40-foot clear heights and 200,000 sf of mezzanine space. It will employ about 350 people when fully operational. Construction of VF’s new distribution hub will get underway next week.
The Allen Group will own the $43-million building. Terms of VF Corp’s lease were not released by the developer. The company would say VF signed a “long-term” lease. In addition, while the building is under construction, VF is leasing an existing 118,000-sf building in the park on a short-term basis. With sales in excess of $6 billion, VF Corp. is one of the world’s largest apparel companies. Its brands include Lee, Wrangler, Vanity Fair, The North Face, Vans, Bestform, Lily of France, Nautica, John Varvatos, JanSport and Eastpak.
While the Allen Group specializes in the development of rail served industrial parks and build-to-suit facilities throughout the western US, it’s making a comeback in its home area of San Diego. According to Allen, in 1997, the company sold its office portfolio to Los Angeles-based REIT Kilroy Realty Corp. for $350 million. Now that Allen’s non-compete agreement with Kilroy is finished, the developer is back to building its San Diego portfolio.
“We have a number of offices we still own and we’re completing a development project in Carlsbad,” says Allen. The Carlsbad project, known as Kelly Corporate Center already has 123,000 sf completed and leased. Countrywide, First American Title and Burnham Real Estate are among the tenants in a 73,000-sf multi-tenant office building. The California Department of Fish and Game occupies another 50,000-sf building for its south coast regional headquarters.
“In 30 days we’ll be breaking ground on a 73,000-sf multi-tenant building,” adds Allen. “And we have entitlements for another 50,000-sf build-to-suit.”