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McClellan Sees Net Increase in Occupancy with New Tenants


McClellan Sees Net Increase in Occupancy with New Tenants

McClellan Business Park has inked leases with five companies totaling nearly 100,000 square feet, for a net gain of about 75,000 square feet over the last year.

Two deals represent expansions by existing tenants; one tenant is new to Sacramento; two others are moving from other parts of Sacramento.

Leases include a contract with the U.S. General Services Administration to construct a 30,000-square-foot custom building for a Department of Defense microelectronics program and expansion of an existing charter school.

The former military base has 8.5 million square feet of space, roughly 65 percent of which is leased. Including space owned and used by federal agencies, occupancy is more than 78 percent.

While new leases are being made, McClellan Park has had deals fall apart in recent years. For example, N Solar Inc., a subsidiary of Millinet, a South Korea-based information technology company, signed a lease for 128,000 square feet in 2010 but has since elected not to come to Sacramento.

N Solar had planned to build solar cells at McClellan Park, but changed gears when the price of solar cells dropped, McClellan Park senior vice president Ken Giannotti said. McClellan is now marketing the space for lease and pursuing a settlement with N Solar.

Other tenants are hanging on to their space, in spite of layoffs.

Aero Union Corp., which flew air tankers out of McClellan Park, is still leasing about 40,000 square feet, said Chelsea DeWeese, marketing director for the business park. Last August the company laid off 60, cutting to a skeleton crew of five, after losing a key contract with the U.S. Forest Service. Company officials could not be reached.

During the past year, McClellan Park has leased 99,810 square feet. Deals include:

• Defense Microelectronics Activity plans to expand by 30,000 square feet for a total of about 80,000 square feet. The Department of Defense-run program owns a 50,000-square-foot building at the park and operates a chip foundry.

A representative of Defense Microelectronics declined to disclose how the additional space will be used until after the group takes occupancy, some time in 2013. A supplier and vendor, Defense Microelectronics works to increase security to military projects.

• Gateway Community Charters, a nonprofit charter-school operator that opened in 2003 in a 17,600-square-foot former day care center at McClellan Park, has grown to 96,197 square feet at McClellan.

That includes 17,606 square feet that Gateway recently leased to add more room for primary grades in the Community Outreach Academy, a K-8 program that serves Russian and other Slavic populations.

Gateway manages five charter schools in the region. It ended the 2011 school year with 3,600 students, up from 320 in its first year. This year, Gateway has expanded to 4,011 students.

“We’re really excited about the growth,” said Jason Sample, director of community engagement and development at Gateway.

Brokers Craig Brinitzer and Breanna Hegseth of Cornish & Carey Commercial Newmark Knight Frank represented Gateway Community Charters in the deal.

• New to Sacramento, Corix Water Products USA signed a five-year lease for a 10,000-square-foot space and an acre of land in February and moved in during April.

The Vancouver, B.C.-based company supplies contractors, cities, counties and water districts with water services and products such as pipe, valves and fittings. The parts are used in public, private and commercial projects.

“We’re looking to expand on the West Coast and throughout the United States,” branch manager Dale Rasmussen said.

Corix first came to California four years ago and today has seven stores in the state, he said. The company employs nine at its McClellan operation.

“We’re just excited to be here,” Rasmussen said. “It’s a great opportunity to be in this location.”

• Pacific Wholesale Fence LLC, a chain-link fence distributor, has leased an 18,364-square-foot warehouse with a small office space and a 1.5-acre yard. Established in Sacramento in 2009, the company moved from Main Avenue last month.

Pacific, which has a half-dozen employees, supplies mainly licensed installers. While residential business has slowed, there is still work to be found on freeways and new developments that call for chain-link fence, said general manager Pedro Goni. For example, he said, the Highway 65 Lincoln Bypass project includes more than 25 miles of chain link.

Sacramento is a very competitive market, he added. There are eight chain-link suppliers here, compared to just two in the much larger Los Angeles market, he said.

McClellan Park makes sense as a location in part because of Pacific Wholesale Fence’s “strong relationship” with Southwestern Wire Inc., a manufacturer at McClellan. Pacific is a distributor for Southwestern Wire, which weaves wire together into a chain-link pattern.

Pacific had $3.5 million in annual revenue last year and expects to surpass that this year.

Joe Curtis of Cornish & Carey Commercial Newmark Knight Frank represented Pacific Wholesale Fence in the deal.

• A 38-year-old Chino-based rain-gutter and metal-roofing materials supplier is consolidating two local warehouses into one at McClellan Park. Custom-Bilt Metals, with operations in West Sacramento, is downsizing from about 50,000 square feet in the region to 23,840 square feet and a half acre at McClellan.

Joel Ramirez, operations manager for Custom-Bilt Metals, said the business climate continues to be tough. To cut costs, the company is reducing its inventory and getting rid of most of its local manufacturing. Plans call for opening a distribution center, with manufacturing, in Nevada.

Custom Bilt-Metals is set to move to McClellan on Aug. 1.

View this article at SacramentoBusinessJournal.com