San Diego Oceanside is running out of room for construction of new industrial projects, and there’s not much room left for companies that want to lease space in existing buildings.
The vacancy rate for industrial buildings in the city is running at around 2.1 percent, said Economic Development Manager Tracey Bohlen.
The low vacancy rate comes at the same time that McDonald Property Group is working on the final pieces of Oceanside’s 95-acre Pacific Coast Business Park with construction of four industrial warehouse buildings.
“That’s almost it,” Bohlen said, aside from two vacant lots in a second industrial park — Ocean Ranch Corporate Center.
The only other big chunk of vacant land left in Oceanside that might be used for industrial commercial real estate construction is the 90-acre site of a former drive-in movie theater on Mission Avenue.
“There’s opportunity there. It’s just not entitled for that,” Bohlen said.
The property had been earmarked for development of a shopping center for more than a decade, but with the advent of e-commerce, there’s been little movement to build it.
“We’d rather have it be industrial, maybe with retail on the frontage,” Bohlen said.
The $55 million McDonald Property Group project, which the company calls its Pacific Coast Collection, is being developed in two stages on 25 acres, said Bruce McDonald, company CEO and president.
The first stage, now underway, is construction of a 124,581 square-foot building at 1319 Rocky Point Drive that will have 6,377 square feet of office space spread over two floors and 118,204 square feet of warehouse space.
The second stage, due for completion by the end of the year, will be construction of the three remaining buildings at 1291 Rocky Point Drive, 1339 Rocky Point Drive, and 1322 Rocky Point Drive.
The 1291 Rocky Point Drive two-story structure will have 117,528 square feet of space with 111,151 square feet of warehouse space and 6,377 square feet of office space
The two-story 1339 Rocky Point Drive building will be 51,102 square feet with 3,652 square feet of office space and 47,450 square feet of warehouse space.
The two-story 1322 Rocky Point Drive building will be109,163 square feet with 102,786 square feet of warehouse space and 6,377 square feet of office space.
“We’re a low finish, industrial product, meaning that we seek manufacturers and warehouse tenants who don’t require a lot of office improvements,” McDonald said. “We’re not tech, we’re not select office research and development.”
The company already has a tenant for the first building, which McDonald said he couldn’t yet reveal, and expects soon to sign up tenants for the remaining buildings.
“Our timing has been extremely good,” McDonald said.
Adam Molnar, first vice president with CBRE in North County, said the Oceanside submarket is a big draw for industrial tenants because of its easy freeway access and location between San Diego and Orange County.
CBRE is handling leasing of the McDonald Property Group project.
“It’s really appealing for low-finish, distribution-type uses and manufacturers that are growing in San Diego,” Molnar said.