Tejon Ranch, Rockefeller Sign Development Deal

Barry Hibbard, VP of commercial industrial marketing for Tejon Ranch, tells GlobeSt.com that the location of the complex at the junction of Interstate 5 and Highway 99 north of Los Angeles, combined with an FTZ designation, will provide access to the ports of Los Angeles and Long Beach as well as the Port of Oakland. He says construction of the first warehouses could begin by mid to late summer, with the buildings to range from about 500,000 sf to 600,000 sf.

The first of these will most likely be build-to-suits, but spec construction may follow. The buildings will be offered for sale or lease to provide flexibility for users, although, as Hibbard points out, "The long-term goal of both Rockefeller and Tejon Ranch is to own."

Obtaining the FTZ designation is one of the keys to the venture, according to Hibbard. "One reason we partnered with Rockefeller is that they're the pros at the FTZ process," he says. Hibbard tells GlobeSt.com that a Foreign Trade Zone would do much to relieve the congestion that slows the movement of goods inland from Southern California's ports. "The idea of the Foreign Trade Zone is to get the goods out of the ports quickly and get them outside of the urban core, but still have access to the Los Angeles urban core as well as the San Francisco Bay area." FTZ designation exempts manufacturers and distributors from paying duty on imported items or raw materials until those goods enter the commerce of the US and enables users to move imported items directly from the ports to the FTZ, avoiding delays at congested ports.

Hibbard explains that the Tejon Ranch site is also a key to the venture because the location is outside of the congestion of the L.A. Basin but close enough for distribution throughout the Basin. A recent Rockefeller Group analysis of imported materials into the ports of Los Angeles and Long Beach showed that Tejon Industrial Complex is well suited for a Foreign Trade Zone designation. The Rockefeller Group is already working with IKEA to obtain FTZ designation for the furniture company's Western North American distribution center at the 1,450-acre Tejon Industrial Complex, which serves IKEA's stores in the western United States and Canada.