■CapRock Partners’ 1.2 million-square-foot building is set for late July or August opening.

■ Visalia’s unemployment rate is 10.2% compared to Fresno’s 8.2%.

■Builder says it doesn’t look at Fresno for new construction.

Five months after announcing a new mega-warehouse for the city of Visalia, the Southern California developers anticipate being finished on the 1.2 million-square-foot building by summer.

It was that efficiency as well as the city’s labor pool that attracted Newport Beach-based CapRock Partners to Visalia, said Bob O’Neill, senior vice president with the company.

“It’s got a very strong labor (pool) as well as a city that is business friendly and wants to see growth in their city,” said O’Neill. “Those are two very important things.”

1.2 Million SF Building the First of Four

The new building is one of four to be built at 4001 N. Plaza Dr, in the Visalia Industrial Park. Not too far away, CapRock Partners also built two Amazon distribution centers.

Walls have been tilted up and the roof work has begun on the site. While they don’t yet have a tenant, the best-suited company would be in distribution, O’Neill said.

Distribution is booming in Visalia, with not only the two Amazon sites but also United Parcel Service and JoAnn’s Fabrics, among others.

However, distribution growth has stuttered nationally.

UPS announced plans in January to cut 12,000 jobs — mostly management and non-union jobs. In the January earnings call, UPS chief executive Carol Tomé said 2023 had been a “difficult and disappointing year.”

Regardless, O’Neill believes that e-commerce is a growth market.

“We know that the American consumer is going to continue online shopping,” O’Neill said. “I can’t comment on the UPS layoffs, whatever right-size thing they’re going through. And, as far as Amazon, they did slow down for a period. … I can tell you in other markets, we have seen them re-engage, absorbing new distribution space. And, so that’s a phenomenon that we’ve experienced in other markets.”

Visalia Can Service Oakland, Long Beach Ports in a Day

From a distribution standpoint, trucks leaving Visalia can get to ports in Oakland or Long Beach and back in less than a day, O’Neill said.

“Which is a really unique feature of the Visalia area because it’s one of the only locations in the state of California that can service both ports in one day,” O’Neill said.

With an unemployment rate well above that of California or even Fresno, Visalia has a labor market that major employers can absorb. In December 2023, unemployment in the Visalia-Porterville area continued to climb, reaching 11.2%, compared to California’s 5.1% and Fresno’s 8.2%.

Employment at the new site will depend on who signs a lease or purchase contract, but those can result in hundreds to as many as 2,000 jobs.

Devon Jones, economic development manager for Visalia, said the Visalia Industrial Park has become the community’s economic engine. He added that industrial development diversifies the job market.

“The primary jobs that it creates import new money into the local economy for circulation,” Jones said. “This leads to an increase in local jobs and local buying power which fuels housing growth, which in turn increases demand for services such as retail.”

Investing in Cities Where It’s Welcomed

O’Neill said they haven’t looked at building in Fresno because of the perceived difficulty of developing there. However, they have looked into investing in existing buildings.

“Fresno’s a little different because they’re not as welcoming to new industrial development, especially in the western part of Fresno,” O’Neill said.

For example, Fresno City Councilmember Miguel Arias appealed the $120 million Scannell industrial project in southwest Fresno after the company finished its environmental impact report.

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“It’s a pretty clear message that, look, we want to go where we’re welcomed and where municipalities see the benefit of what we’re doing with the jobs,” O’Neill said.

CapRock Adapting Warehouse to Meet Future Environmental Needs

Environmental concerns lead to many objections to industrial development as trucks are integral to e-commerce. However, O’Neill says that developers are working to reduce the impact of logistics on neighborhoods.

Designating truck routes keeps vehicles out of neighborhoods, and trucks are getting cleaner. In addition, port authorities have prohibited old diesel trucks from entering.

In anticipation of electrification requirements set by the state, CapRock is laying electrical conduits for truck chargers. By doing that work now, future operators won’t have to trench into concrete to lay wiring. They also reinforced the building’s roof to support solar panels.

After the first building is completed and leased, the company will begin work on the second building. O’Neill anticipates that will be the second or third quarter of 2025.