Contra Costa County has emerged as one of the most dynamic industrial markets in Northern California. Positioned along the I-680 and Highway 4 corridors, the county offers a compelling combination of relative affordability, strong demographics, and excellent transportation access that continues to attract both tenants and investors.
This deep dive examines each major submarket within Contra Costa County, providing property owners and investors with the detailed intelligence needed to make informed decisions in this competitive market.
County Overview
Contra Costa County encompasses approximately 18 million square feet of industrial space across a variety of product types, from small-bay multi-tenant facilities to large distribution centers. The county has benefited from several tailwinds in recent years:
- Population growth: The county's population exceeds 1.1 million, providing a deep labor pool and consumer base
- Housing affordability: Relative to San Francisco and Silicon Valley, Contra Costa offers more affordable housing, attracting workers and the businesses that employ them
- Transportation: BART access, major highway corridors, and proximity to Port of Oakland support logistics operations
- Business-friendly environment: Lower costs and less regulatory friction compared to other Bay Area counties
18M+
SF Industrial Space
3.9%
County Vacancy Rate
$1.42
Avg Asking Rent/SF
Submarket Profiles
While county-wide statistics provide useful context, industrial real estate performance varies significantly by submarket. Understanding these differences is crucial for targeting investments and maximizing returns.
Concord
Concord is the largest and most active industrial submarket in Contra Costa County. Its central location along Highway 4 and proximity to I-680 makes it ideal for distribution and service businesses. The submarket features a diverse mix of multi-tenant small-bay properties and larger single-tenant facilities. Tenant demand remains exceptionally strong, particularly for spaces under 10,000 SF with drive-in loading and adequate parking. Limited new construction has kept vacancy tight and supported aggressive rent growth.
Walnut Creek
Walnut Creek commands premium rents due to its affluent demographics and limited industrial inventory. The submarket is ideal for businesses serving high-income residential customers—contractors, home services, specialty retail distributors. Industrial properties here are predominantly smaller multi-tenant flex buildings. The scarcity of available space and high barriers to new development create a landlord-favorable environment with strong rental rate appreciation.
Pleasant Hill
Pleasant Hill bridges the gap between premium Walnut Creek and value-oriented Concord. The submarket offers excellent access via I-680 and Highway 24, attracting a mix of service businesses and light industrial users. Properties here tend to be well-maintained multi-tenant buildings with strong occupancy histories. Pleasant Hill appeals to tenants seeking quality space without Walnut Creek pricing.
Martinez
Martinez offers the best value proposition in central Contra Costa County. Located along Highway 4 and I-680, the submarket provides access to the same transportation network as Concord at approximately 15-20% lower rents. Martinez has attracted tenants priced out of tighter submarkets, driving strong absorption and accelerating rent growth. The submarket is particularly attractive for distribution operations and businesses requiring larger footprints or outdoor storage.
Antioch / East County
Antioch and the broader East County submarket represent the value end of the Contra Costa industrial spectrum. While vacancy is higher than central county submarkets, rent growth has been the strongest in the county as tenants seek affordable alternatives. The extension of BART to Antioch has improved the area's accessibility and labor pool. Investors focused on yield and rent growth potential should closely evaluate this emerging submarket.
Tenant Demand Drivers
Several key tenant segments are driving demand across Contra Costa County's industrial submarkets:
Construction and Trades
The robust residential and commercial construction market throughout the Bay Area has fueled demand from general contractors, electricians, plumbers, HVAC companies, and building material suppliers. These tenants typically seek 3,000-8,000 SF spaces with yard storage, making multi-tenant industrial parks particularly attractive.
E-Commerce and Last-Mile Delivery
The continued growth of e-commerce has driven demand for distribution space close to population centers. Companies providing same-day and next-day delivery need facilities within 30 minutes of their customer base, positioning Contra Costa County's central location as strategically valuable.
Food and Beverage
Food production, beverage distribution, and cold storage operations have expanded significantly. The county's relatively affordable rents for food-grade space, combined with proximity to both Bay Area consumers and Central Valley agriculture, make it attractive for this growing sector.
Automotive Services
Auto repair, body shops, tire retailers, and specialty automotive businesses continue to absorb industrial space. As electric vehicles gain market share, EV service and charging infrastructure businesses are emerging as a new demand driver.
Investment Considerations
For investors evaluating Contra Costa County industrial properties, several factors warrant consideration:
Key Investment Themes
- Value-add opportunity: Properties with below-market rents offer significant upside through lease-up and mark-to-market renewals
- Submarket migration: Tenants priced out of premium submarkets create opportunity in Martinez and East County
- Small-bay outperformance: Multi-tenant properties with units under 5,000 SF generate higher per-SF rents and stronger rent growth
- Limited supply: Zoning restrictions and land costs limit new construction, supporting existing asset values
Cap Rate Expectations
Cap rates for Contra Costa County industrial properties vary by submarket, asset quality, and tenant profile:
- Premium submarkets (Walnut Creek, Pleasant Hill): 5.50% - 6.00%
- Core submarkets (Concord): 5.75% - 6.25%
- Value submarkets (Martinez, Antioch): 6.25% - 7.00%
Value-add properties with below-market rents typically trade at 25-50 basis points below these ranges, reflecting buyer confidence in achieving rent growth.
The Bottom Line
Contra Costa County offers compelling opportunities across the risk-return spectrum for industrial investors. Premium submarkets like Walnut Creek and Pleasant Hill provide stability and steady appreciation, while value submarkets like Martinez and Antioch offer higher yields and stronger rent growth potential.
Success in this market requires submarket-specific expertise and deep relationships with the tenant community. Understanding which submarkets are gaining versus losing momentum, and which tenant segments are expanding versus contracting, is essential for both acquisition decisions and asset management strategies.
"The key to Contra Costa County industrial investing is understanding the nuances between submarkets. A strategy that works in Walnut Creek may not apply in Martinez, and vice versa. Local expertise matters enormously."
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