Amazon to Sell Bay Area Office Complex as Sales Growth Cools

Amazon to Promote Bay Space Workplace Complicated as Gross sales Development Cools


The Amazon brand exterior the corporate’s achievement heart in Sydney, Australia. (Brent Lewin/Bloomberg Information)

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Amazon.com Inc. is promoting a vacant Bay Space workplace advanced bought about 16 months in the past, the corporate’s newest effort to unwind a pandemic-era growth that left it with a surfeit of warehouses and workers.

Amazon in October 2021 paid $123 million for the 29-acre property in Milpitas, Calif., a part of a method to lock up actual property close to massive cities that may very well be used for brand new warehouses and facilitate future development.

The Metro Company Heart is now in contract with a industrial actual property developer, based on three individuals accustomed to the scenario, who requested anonymity as a result of they’re not licensed to debate the deal publicly. One of many individuals stated Amazon is prone to take a loss on the sale. One other individual stated the ultimate sale worth continues to be being negotiated.

The Bay Space’s workplace market has been hit arduous over the previous two years, as firms pivoted to distant work and gave up actual property to chop prices. Practically one-fifth of the workplace market is vacant, based on a fourth-quarter report from CBRE Group Inc. Amazon was probably planning to exchange the workplace advanced with supply amenities, however such growth has been stalled throughout the area owing to new municipal laws and rising constructing prices.

“We’re all the time evaluating our community to ensure it suits our enterprise wants,” Amazon spokesman Steve Kelly stated in a press release. “As a part of this effort, we’ve made the choice to discover promoting the Metro Company Heart web site. We’re comfortable to stay a part of the local people and can proceed to ship for purchasers from our two supply stations in Milpitas.”

Host Seth Clevenger speaks with Torc Robotics CEO Peter Vaughan Schmidt in regards to the realities of autonomous truck expertise and the way they match into the freight transportation trade. Hear this system above and at RoadSigns.TTNews.com

Second of a three-part collection on autonomous autos. Half III coming Feb. 2.

Amazon’s choice to promote the property underscores the dangers of a brand new actual property technique the corporate has embraced lately. Bloomberg Information reported final yr that the corporate was quietly shopping for property throughout the U.S. The actual property included current buildings and naked land that the corporate deliberate to make use of for a brand new technology of achievement facilities that it might develop itself. Beforehand Amazon had relied on builders to search out property and construct the amenities.

When on-line gross sales development started slowing final yr, Amazon began pulling again on its property technique, pausing growth of a 193-acre parcel exterior Austin, Texas. Now, with the Bay Space sale, the Seattle-based firm has begun offloading properties, suggesting executives count on sluggish development to endure.

Amazon continues to open new amenities — together with warehouses in Omaha, Neb., and Sioux Falls, S.D., earlier in January — however at a extra measured tempo than in the course of the pandemic when it wanted all of the area it may discover.

Amazon final yr started its biggest-ever spherical of job cuts that may finally have an effect on 18,000 employees across the globe. The world’s largest e-commerce firm, which is scheduled to report earnings on Feb. 2, warned buyers that fourth-quarter gross sales development can be the slowest in its historical past.

Amazon.com Inc. ranks No. 19 on the Transport Subjects High 100 checklist of the most important personal carriers in North America.

With help from Natalie Wong.

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