Sysco Renews 451,000-SF Industrial Lease

FREMONT, CA-Sysco has renewed its lease for a 451,250-sf distribution facility it has occupied here for the past decade. The food service distributor signed on for five more years in the building, according to broker Steve Kapp of BT Commercial in Oakland, who represented Sysco in the transaction with partner Garry Fracchia.Located at 5900 Stewart Ave., the 20-year-old facility was extensively remodeled before Sysco originally occupied the space, which has a 30-foor clear height and about 30,000 sf of office build out. The building is owned by the US Steel Carnegie Pension Fund, which was represented in the transaction by Bill Shubin of Strategic Realty Investors of Newport Beach, CA. Kapp declined to reveal the value of the lease, but a local broker familiar with the transaction tells GlobeSt.com the deal value is just under $10 million. The new lease commences when the existing lease expires in September. Regarding the lease negotiations, Kapp tells GlobeSt.com, “We had our comps and they had their comps. We discussed why certain ones weren’t applicable and then came to an agreement.”Kapp adds that there has been lots of leasing activity in the Fremont industrial market as of late. In the past month or so, about 1 million sf of deals have been done. In addition to Sysco, Cyber Home Entertainment inked a lease for 246,000 sf in a former Sony warehouse, Exel leased 190,000 sf on Christie Street, and Valley Relocation renewed a lease for 110,000 sf at 48973 Warm Springs Blvd.The fact that they all closed in the past month is coincidence, as negotiations for the leases had been ongoing for several months, says Kapp. As for why they all came to Fremont, Kapp says, “Fremont had the functional, large-floorplate warehouses these companies were seeking, at attractive prices.”