CHARLES H. HARRIS & ASSOCIATES (Established 1960)

COMMERCIAL AND INVESTMENT OPPORTUNITIES ABOUND IN SAN JOAQUIN COUNTY

By

Thomas E. Kennedy

Vice President, Real Estate Acquisition, Sales and Financing

Thomas E. Kennedy

Unlike Horace Greeley's quote to "Go West Young Man” the migration of industrial and commercial assets from the West to the East, from the Bay Area to the Central Valley,is growing at a substantial pace.

Like the Dublin and Livermore valleys 20 years ago, the demand for commercial and investment property in the San Joaquin Valley is at its very beginnings. Business owners looking to expand their operations into lower cost facilities, taking into account lower property taxes and wages, are at the forefront of this march.

To think about the commercial and investment opportunities in the county, it is best to view the land in the shape of a grid. Freeways and interchanges divide and point to the areas of opportunities that have not yet been fulfilled or realized.

THE SOUTHERN GRID

The southern edge of the grid begins with the 580 freeway rolling east bound off the Altamont Pass connecting with Interstate 5 about four miles south of the community of Tracy. Because of the ease of access, this southern boundary is just beginning to see the development of warehousing facilities. Inexpensive land versus that which exists in the Bay Area have seen several large warehouses for both retail and industrial distributions open in just the last two years. There are numerous opportunities along this southern corridor of the county for anyone looking to either expand or transfer from higher cost facilities in the bay area to lower cost improvements in the county where ease of access into the bay area is needed.

Driving over the Altamont into the valley takes you onto the 205 expressway, beginning with its branching off of the 580 freeway. The 205 is a straight shot into the community of Tracy. Crossing over the Mountain House exit and traveling east, the freeway splits the community into two pieces. To the south of 205, the demand for housing and apartments becomes really apparent. New residential developments abound for both single family residences and apartments. Farm land that contained livestock and crops just a few short years ago are being rapidly replaced by several large housing developments.

One long term investment opportunity today is in the undeveloped land that begins at Tracy's western most development, moving further west to where the 580 freeway and 205 expressways meet. This land, is partly encompassed by a project called "Gateway Development," and is targeted for high end retail, campus office complexes, and recreation facilities, encompassing approximately 1,000 acres total. Formal development of this area is projected to begin in the next 7-10 years.

A more immediate development opportunity is along Grantline Road east of central Tracy. Several large warehouses including a facility for Kelloggs are in the early stage of development with several large plots available. Between 11th Street and Grantline Road 3.28 acres are now available. Also, from McArthur Boulevard south off of the 205 expressway, light industrial including tilt ups for warehousing and cold storage are in the process of being completed. A forecast for demand of smaller industrial facilities between 5,000 and 10,000 square feet is also a distinct opportunity for investment.

Off of the Tracy Boulevard exit from 205 and south of Valpico, the city has annexed an area requiring mixed use of commercial and residential developments. Manufacturing property is available that abuts the Southern Pacific Railway as well.

At the intersection of Tracy Boulevard and 11th Street, with 11th being a major corridor through Tracy itself, the West Park development has completed its first phase due to start. Medical and Dental, as well as small retail services such as a travel agency currently inhabit the first phase.

North of 205 Expressway contains two distinct opportunities.

Immediately off of 205 is the Mountain House Parkway, which leads to the new community of Mountain House. Starting from scratch, the initial development of residential subdivisions has just recently begun. The first new school for the community is also in its finishing stages. Opportunities for development of office campuses as well as retail centers are available.

Driving further into Tracy, a plethora of new retail developments are continuing at pace. Home to category killers such as Home Depot, Walmart and Best Buy, numerous opportunities for retailers large and small continue to grow.

Traveling further east on 205 takes you past additional sites for warehousing and trucking before you intersect with I-5. At the intersection of 205 and Interstate 5 several warehouses including Chrysler and Nestle are taking advantage of easy access to I-5 for north and south distribution in addition to lower cost access to the bay area. Several parcels are available in close proximity. Access to State Route 99 is also straightforward since State Route 205 connects I-5 and Highway 99 just south of the I-5/205 intersection.

THE NORTHERN GRID

Driving northbound on HWY-99 takes you past several large warehousing and light industrial parcels from Manteca northbound. The first large light industrial area that has really taken off, no pun intended, is off of Arch Road which is contiguous to the Stockton Metropolitan Airport. Numerous distribution companies and office complexes have sprung up in just the last 24 months with several sites still available. Access to the main USPS distribution center is literally within minutes of any firm located there. This area also includes a very tax friendly Enterprise Zone. 

This area also includes the San Joaquin County Fairgrounds and is only minutes from Downtown Stockton and the Port of Stockton. It is also within minutes of major freeways I-5 and HWY-99 going north and south, along with HWY-4 going east and west.

Traditionally, many of the current Lathrop residents have needed to travel to Tracy, Manteca or Stockton for retail services. But with several new subdivisions for both Low and Medium Density Residential development now approved from the west side of I-5 to the San Joaquin River, the demand for local services will rise sharply.

There are two separate and distinct areas available. The North Unit is the larger of the two with a total area of 122.5 acres. It is located south of Louise Avenue and west of Interstate 5 to the east and the San Joaquin River west. The South Unit is comprised of 29 acres.

Driving several miles north on I-5 takes you to the last major commercial development currently in progress. Just off of Eight Mile Road and the west side of I-5, representing the northwest corner of Stockton, a new retail and services development is being built in addition to the construction of several new subdivisions for both apartments and single family homes. One or two category killer stores have been identified as anchors for these new neighborhood retail centers. 

If you are interested in exploring the investment opportunities of San Joaquin County, please call me at 1-800-952-7233. I can help you put together a "Package of Opportunity" consisting of Real Estate Consultation, Acquisition, Sales, Financing, Development and other Real Estate Services.

You can also e-mail me directly at tek@chhassoc.com.

I look forward to talking with you and developing a long and rewarding relationship.

Thomas Kennedy

Stockton City Hall

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