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A CITY ON THE MOVE

COMPANIES WHO SAY ‘YES’ TO FREMONT

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Fremont the "hot new address" for startups

san-jose-mercury-news-logo-small.pngSan Jose Mercury News technology writer Michelle Quinn recently highlighted both Fremont and Berkeley as the “hot new address” for tech startups.

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Redefining What it Means to be a Silicon Valley City

business-journal.pngA supplement printed on July 31, 2015 in the Silicon Valley Business Journal. The supplement provided an overview of Fremont’s the business ecosystem.

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“With the BART expansion well underway, we’re excited to breathe new life into Silicon Valley with a projected 30,000 new jobs in Fremont by 2040.”

—Kelly Kline, Fremont Economic Development Director



Patrick Donlon
Senior VP of Sales, Pivot Interiors

Earlier this month, Pivot was pleased to welcome the real estate community into our new ‘super-hub’ to provide a real-life example of how today’s industrial space can flex. Thanks to an event organized by the Building Owners and Managers Association (BOMA…

Earlier this month, Pivot was pleased to welcome the real estate community into our new ‘super-hub’ to provide a real-life example of how today’s industrial space can flex. Thanks to an event organized by the Building Owners and Managers Association (BOMA), developers, property managers, and other stakeholders convened at Pivot Interiors’ new facility located at The Crossings @ 880 in Fremont for a discussion on the allure of flex industrial projects such as this one. 

As a company that grew up alongside many of Silicon Valley’s corporate anchors, we believe that we have unique insight into how space usage has changed over the years. And ours is no exception. As the largest Herman Miller dealer in California, we have a diverse operation including offices, showrooms, and warehouse/logistics space. 

At The Crossings, we leased 101,000 square feet of Class A industrial space, and we added about $1.1 million worth of tenant improvements with the help of ArcTech architects and Oltman Construction. This building provided us with the opportunity to consolidate three previously distinct, and geographically dispersed functions, under one roof, gaining huge efficiencies. And because the space was brand new, we were able to customize the build out in a way that can’t always be done with existing space. This means the facility feels and operates exactly the way we want it to, driving employee satisfaction and productivity.

Today, our Fremont facility is an integral part of Pivot’s business, serving multiple purposes. Most importantly, it’s a ‘living’ show room. The active office function is highly visible by customers, who can observe how our products look and feel by seeing our own employees working in this environment. It’s also a great backdrop for events − something BOMA already figured out! Finally, by integrating various functions, we have broken down silos between business units and have seen collaboration reach new levels.

We believe that going forward, more companies will seek out this large, highly flexible space to accommodate diverse activities and customization. In this age of hyper-innovation where flexibility is king, it only makes sense that our workspaces should reflect the same principle. 

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The Future of Fuel Cells in Fremont



Kelly Kline
Economic Development Director & Chief Innovation Officer

Fremont is a city of early adopters, as reflected in the rates of EV ownership, which are among the highest in California. Therefore, it’s no surprise that Fremont is among the first Bay Area cities to build a hydrogen fueling station – which arrives just…

Fremont is a city of early adopters, as reflected in the rates of EV ownership, which are among the highest in California. Therefore, it’s no surprise that Fremont is among the first Bay Area cities to build a hydrogen fueling station – which arrives just in time for the Toyota Mirai fuel cell vehicle that is now available online and in select dealerships.

Fremont staff recently had the opportunity to check out the Mirai, and talk with Toyota and its partners about their clean energy goals and the future of passenger vehicles. Here’s what we learned:

  • Toyota’s suite of hybrid vehicles has already diverted 67 million cubic tons of C02 emissions and saved 6.6 billion gallons of gas worldwide.
  • The Mirai fuel cell stack combines 20 years of engineering work to deliver maximum power density in the smallest size stack possible.
  • 370 cells on the fuel stack pull in hydrogen, which is combined with air to create electricity, resulting in water as a byproduct. The engine produces power on demand, with zero emissions.
  • Safety features include carbon reinforced tanks, sensors that stop fuel flow in case of an accident, and eight airbags.
  • The range will take you 312 miles, and even better, when you do need to fill up, you’ll be on your way five minutes later (unless you need a Slurpee!)
  • Hydrogen stations are rolling out statewide. Nine stations are now open in Northern California including Hayward, San Jose, Truckee, and Harris Ranch. Six more will open in 2017 including Fremont, Palo Alto, and Mountain View.
  • While the cost for hydrogen is currently higher than gas, Toyota is offering three years of complimentary fuel up to $15,000. They’re also throwing in three years of enhanced road service, three years of complimentary maintenance, and an eight-year/100k mile warranty on key fuel cell system components.
  • The sticker price is $57,500 with $13,000 of state/federal rebates available, and zero percent financing for 60 months. Leases are quoted at $499/month for 36 months.
  • Of the 5,000 units that Toyota will produce globally through this and next model year, the majority will be sold or leased in California and the Northeast.

With 58 percent of Fremont’s greenhouse gases being attributable to vehicles, the City remains interested in opportunities to increase the number of zero-emissions vehicles on our roads. You can find out more about the Mirai here.

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Kelly Gray
VP, JLL Silicon Valley

In an effort to highlight national and local trends in real estate, technology, and manufacturing, we recently caught up with Kelly Gray, Vice President of Brokerage and Location Advisory at Jones Lang LaSalle, for her insights on industrial real estate.

In an effort to highlight national and local trends in real estate, technology, and manufacturing, we recently caught up with Kelly Gray, Vice President of Brokerage and Location Advisory at Jones Lang LaSalle, for her insights on industrial real estate.

1. What dynamics are driving the strong market demand for industrial buildings in Fremont and the East Bay? 

KG: There are three main factors playing into the industrial real estate market demand in this area.

  • Ecommerce – the desire to get closer to the end user for parcel delivery (for example, recent FedEx and Amazon deals in East Bay)
  • Growing population in the Bay Area and high consumer spending habits of Bay Area residents (for example, Living Spaces)
  • Automotive industry – Tesla is increasing production while Apple and others are taking down industrial space for testing of autonomous vehicles.

2. How can cities in the Silicon Valley area support the continued growth of the industrial sector?

KG: Continue to be open to zoning for industrial use. The concept of rezoning or redeveloping industrial land for a “higher and better use” is prolific in the Bay Area. Over 10 million square feet of space has been taken out of the market in the past five years. This is driving down vacancies and pushing prices within the Bay Area to record levels, for example, the Facebook and Google displacements of industrial users in Menlo Park and Sunnyvale.

Local regulations on truck traffic also curb industrial development, especially for “big box” industrial (250,000 square feet, high clear distribution centers) such as Amazon in Newark. Industrial development is a great way to add economic stability to an area and allow for employment opportunities for a diverse workforce. Historically, office and residential rents commanded higher land costs on a “per square foot” basis and provided higher taxes, but I think recent industrial success stories will prove otherwise. 

Often, people do not think about how the goods they buy end up on store shelves or doorsteps. The concept that it takes over 70 million square feet of real estate in the Bay Area to make it happen is unknown. Industrial just isn’t as sexy as office and residential. It’s function over form. 

3. Can you provide some insider real estate tips for companies interested in expanding or entering Fremont’s market?

KG: First, do the math.  Determine the cost-qualitative trade-offs between Fremont vs. cheaper, further locations like South San Jose or the Central Valley. If you need to be in Fremont, either for the transportation, the diverse workforce, the density of engineers, etc., then ignore the sticker shock and pay the extra rent.

If leasing, take the plunge on longer term rents and negotiate renewal options. If you can get a purchase option, take it. With demand up and supply dwindling, space will only get more difficult to come by and acquire. If you have the opportunity and the capital to purchase, go for it. 

4. In the next 24 months, what can we expect in the industrial market in Fremont and the East Bay? 

KG: This year in the Bay Area, signs indicate that we may be at the top of a bull market for real estate. A correction can be expected in the next twelve months, but not drastic. 

In the next five years, the Bay Area market will continue seeing record rental rates and low vacancies as office and residential demand cannibalize industrial space. The industrial will push out to the Central Valley. Ultra-high volume consumer distribution (Amazon, FedEx, and UPS) will pay the extra money to stay close to the population. If property costs continue to rise, the Bay Area may be the first market to see multi-story industrial in the U.S.

5. When do you predict the City of Fremont will see multi-level industrial space?

KG: It will be a race between ever-increasing land values and autonomous driving technology. If autonomous car and truck fleets free up parking spaces for increased land utilization, then it could delay the multi-story industrial. If not, I could see it happening with the big players, like Amazon, in five years, relatively the same horizon for autonomous cars. 

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Category: Manufacturing