Medline Leases 1.6 MSF in California’s Central Valley
The health-care company has entered into an agreement to occupy two facilities.
Medline has leased 1.6 million square feet in Central Valley across two facilities—an existing 925,475-square-foot warehouse in Tracy, Calif., and a 709,000-square-foot facility in Stockton, Calif.
The health-care company previously used another facility in the area at 5701 Promontory Parkway in Tracy, Calif., but that warehouse was destroyed by fire in June. The new distribution center is within 10 miles of the former one, at 9375 Sugar Road. Just off Interstate 205, it is close to interstates 5 and 580.
The property at 9375 Sugar Road came online in 2020 on 42 acres and was previously leased by arts and crafts store Michaels, according to Yardi Matrix information. E & E Co. is the owner of the property, while Lee & Associates oversees leasing. The building has 36-feet clear heights, four drive-in doors and 162 dock-high doors. It will also adopt the same use of AI in industrial real estate as other Medline facilities.
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In addition, Medline’s new 709,000-square-foot facility in Stockton is planned to open in January 2027. The firm intends to operate from these facilities over their long-term leases, a Medline spokesperson told Commercial Property Executive.
Across the state of California, Medline’s presence is set to reach nearly 5 million square feet by mid-2027, including a new 1 million-square-foot distribution center in Perris.
IDI Logistics is the owner of the future warehouse at 815 South Redlands Ave., Yardi Matrix data shows. Construction at the facility within Perris Logistics Center North started at the beginning of this year. Upon completion, it will sit on 48 acres and include 58-by-60-foot column spacing, 42-feet clear heights, a 185-foot truck court, four grade-level doors and 153 dock-high doors.
Central Valley vacancy grows
National in-place rents for industrial space averaged $9.12 per square foot in May, according to a recent Yardi Matrix industrial report, increasing four cents over the past month and 5.2 percent in the last year. Leases signed in the past 12 months averaged $10.06 per foot , 94 cents above the national average for in-place rents.
Central Valley rents sat at $7.02 in May and climbed up 4.4 percent year-over-year, with the average rate signing clocking it at $8.35 in the last year. Meanwhile, the market’s vacancy rate was 14.5 percent, the highest out of the top 30 markets analyzed.
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