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March 01, 2016

Apple leases old Pepsi bottling plant in Sunnyvale

Silicon Valley Business Journal

Nathan Donato-Weinstein

During its current growth binge, Apple Inc. has snapped up a former FedEx warehouse, an old chip fab and innumerable nondescript office and R&D buildings. Now you can add another unique space to the list: An ex-Pepsi bottling plant.

Apple leased the 96,000-square-foot industrial property at 960 Kifer Road in Sunnyale last November, according to a public document I reviewed last week. The lease wasn't widely known, but its existence is disclosed in a loan document on file with the county clerk's office and filed on Feb. 22.

There's some irony here. Apple, of course, was led for a decade by John Sculley, the former CEO of Pepsi. He was lured to the position by late Apple co-founder Steve Jobs, who famously asked him, "Do you want to sell sugar water, or do you want to come with me and change the world?"

What's Apple interested in doing with it? That's unclear, though Apple's reportedly been using some industrial buildings in Sunnyvale for its car research. An Apple spokesman didn't immediately respond to an email. City permit records aren't much help; the only thing on file is for a seismic upgrade submitted in January. That suggests that the building will remain and won't be redeveloped. The property had previously been used as a plant for the Pepsi Bottling Group, which last renewed its lease in 2011, according to Kidder Mathews research. The lease expired in 2013, and it's been vacant since then. It's not clear how long Apple has leased the building.

Built in 1957, the facility sits on 5 acres and is largely a warehouse-type industrial building and includes truck docks in back.

Apple is known to have a significant need for industrial space; in addition to high-end office buildings, the company has also been leasing warehouse-type space. A good example is in Fremont, where Apple leased a significant amount of warehouse at Crossings @ 880.

It's located in an area where Apple has been growing by leaps and bounds. Apple also has leased 1150-1170 Kifer, an 80,257-square-foot project that's an 8-minute walk down the street, at Lawrence. Across the street from that complex, Apple also leases 3689 Kifer Road, a 140,000-square-foot Class A office building.

The other big players in this neighborhood are Texas Instruments and Intuitive Surgical. Intuitive in particular has big growth plans; as I reported in late 2014, the medical technology company purchased a 15-acre private park from TI for a possible campus expansion.

For the full story, go to Silicon Valley Business Journal.

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