Apple has signed a 10 year lease on 313,978 square feet of industrial manufacturing space in Milpitas, CA, according to The Silicon Valley Business Journal (SVBJ). It’s not yet known what Apple intends to do with the space, as it could be used for manufacturing, research and development, or warehousing needs.
The time frame for Apple’s plans is also unclear. While the lease was just signed and is for 10 years, Silicon Valley industrial warehousing space is notoriously tight. SVBJ reported that this deal alone reduces total vacancy for these types of properties from 1.5 percent to 0.7 percent. Which is to say, in all of Silicon Valley, there’s less than another 300,000 square feet available.
What makes that important for speculating when Apple might be planning to use this space is the reality that Apple could be looking years out. Securing it now and letting it sit vacant for a few years could well be the best play if you’re serious about doing it in Silicon Valley.
SVBJ also reported that Apple might be paying as much as US$0.90 per square foot for the space.
The first thing that springs to mind is Apple’s ongoing Project Titan autonomous vehicle effort. Apple already has a myriad of spaces around Silicon Valley dedicated to Project Titan. It remains to be seen, however, if the company still plans to make an actual car, and if it does, whether it would manufacture the device in Silicon Valley.
As big as Apple is getting, it could use this space for testing, making the robots that will make its devices, component testing, component manufacturing, or even just warehousing something like a car being assembled elsewhere. There’s no end to what Apple could be planning on using this space for.
SVBJ has more information on the state of Silicon Valley real estate.