UPS loves logistics — especially when it’s run out of one of Compton’s largest warehouses.
United Parcel Service just signed a lease for 525,400 square feet at Clarion Partners’ recently completed Brickyard development. Valued at more than $44 million, it’s one of the largest industrial leases in Los Angeles County at a time when vacancy rates hover around 1 percent, the Los Angeles Business Journal reported.
The city of Compton is also involved in the deal. UPS will buy at least $70 million worth of equipment locally. In return, the city will waive 30 percent of the company’s taxes for up to 10 years.
Before moving in, UPS will need to build out its interior. Slated to open late next year, the facility will be able to accommodate 300 trucks and 160 full-time employees within five years. Mike Fowler and Tim O’Rourke of JLL represented UPS in the lease deal.
The nearly 60-acre Brickyard — located on a block bound by Central Avenue, Sam Littleton Street, McKinley Avenue and Rosecrans Avenue — was developed by the Dallas-based Trammell Crow Company and partner Principal Real Estate Investors, of Des Moines, Iowa. The two firms purchased the site for $37 million, or just $14.40 per square foot of land, in 2014. It sold to Clarion last December and CBRE is now responsible for its marketing.
Bret Quinlan at CBRE told the Business Journal the Brickyard is exceptional in size, considering the average large building in the South Bay area is about 100,000 square feet.
Demand for shipping centers is largely driven by the advent of e-commerce. Industrial REITs, in turn, have benefitted greatly, posting a 17.3 percent increase in shares this year. [LABJ] — Cathaleen Chen