The new $ 100 million Landmark located in the 50-acre Otay Industrial Park, under construction since February, has its first tenant – a company specializing in Mexican imports.
RL Jones Customhouse Brokers, which operates across the US-Mexico border, will lease 153,000 square feet of the complex for approximately $ 8 million for five years. RL Jones is positioned adjacent to all of the major southern US border entrances to Texas, New Mexico, Arizona and California.
Landmark at Otay seeks to take advantage of rapid industrialization near the Otay Mesa Port of Entry following tax changes in 2019 to benefit US and Canadian businesses importing from Mexico to Asia.
The Landmark Project is a 50/50 joint venture of two Southern California companies: Majestic Realty Co., based in City of Industry, and Sunroad Enterprises, based in San Diego. It has four buildings, two of which are nearing completion by the end of the year and the other two by early 2023.
This probably would have been one of Otay Mesa’s biggest projects without Amazon. The Seattle-based retailer, which recently opened a 3.4 million square foot distribution center, has begun construction of a 702,535 square foot sorting facility nearby and has also purchased a 63-acre site from the across the street in September.
Unlike Amazon, the new Landmark at Otay lease is specifically tied to the border as the retailer would mainly take advantage of cheaper land.
RJ Jones already leases 81,213 square feet at Otay Mesa on Siempre Viva Road and has offices in Tijuana near the Otay Mesa intersection.
The company, in business since 1938, claims to be able to facilitate trade with Tijuana’s growing maquiladora industry. He also said he was proposing to consult Section 321, which allows goods into Mexico costing less than $ 800 to cross the U.S. border for duty-free customers.
Changes to tax laws aimed at making trade between countries in North America more favorable were included in the US-Mexico-Canada agreement, dubbed âNAFTA 2.0,â signed by the Trump administration. The closer outsourcing process is called “nearshoring” and has taken on new importance with supply shortages in many of the country’s seaports.
Cross-border trade between San Diego and Tijuana is also expected to increase with a $ 137.2 million remodel of the Otay Mesa crossing that will increase its capacity from six lanes to 12 and make other upgrades to modernize.
Manufacturing is expanding on both sides of the border to meet demand. La Tijuana Economic Development Corp. said that more than 60,000 people are employed in the manufacture of electronic products; 14,600 in automobile manufacturing; and 42,000 in the manufacture of medical devices. He said the minimum wage in Mexico is 88.36 pesos per day, or $ 4.29. That compares to $ 14 an hour at minimum wage in San Diego, or $ 112 in a typical 8-hour day.
Colliers senior vice presidents Chris Holder and Mark Lewkowitz, along with partner Will Holder, represented Majestic Realty Co. and Sunroad Enterprises in connection with the lease agreement. Regan Tully of Cushman Wakefield represented RL Jones.