Three land deals at the base of the Grapevine show the three ways Tejon Ranch Co. turns entitled acreage into value: selling to users, selling for commercial pads and selling into its own joint ventures.
Tejon Ranch Commerce Center land sales in 2025 and 2026 came in three pieces. Tejon Ranch Co. recognized $2.373 million of deferred revenue from Nestle USA’s 2022 purchase of about 58 acres after Nestle finished its 700,000-square-foot distribution center in July 2025. Tejon also sold a hotel site in 2025 on undisclosed terms. It recorded a $6.9 million sale of the 24.57-acre Building 1B parcel to its Dedeaux Properties joint venture in the second quarter of 2026.
Key takeaways
- Tejon recognized $2,373,000 of land-sale revenue in Q3 2025 after meeting its remaining obligation on the 2022 sale of about 58 acres to Nestle USA. That figure is not the purchase price.
- Nestle opened its distribution center at Tejon Ranch Commerce Center (TRCC) on June 10, 2026, under an Arvin address. The company cites an investment of more than $330 million and more than 110 jobs.
- By our calculation, the $6.9 million Building 1B land sale works out to about $280,800 per acre, or roughly $6.45 per square foot of land, for the 24.57-acre site.
- Tejon’s 2.8 million square feet of joint-venture industrial space at TRCC was 100% leased as of June 30, 2026.
- TRCC had 11,099,077 square feet of industrial entitlements remaining at the end of 2025, out of 19,300,941 entitled, according to Tejon’s 2025 annual report.
Deal at a glance
| Item | Detail |
|---|---|
| Property | Tejon Ranch Commerce Center (TRCC), Lebec area, at the Interstate 5 and State Route 99 junction, unincorporated Kern County |
| Seller | Tejon Ranch Co. (NYSE: TRC) |
| Deal 1: Nestle USA | About 58 acres on the east side of TRCC, sold in 2022; $2.373 million of deferred revenue recognized Q3 2025; building completed July 2025, opened June 10, 2026 |
| Deal 2: Hotel site | Sold in 2025; buyer, acreage and price not disclosed |
| Deal 3: Building 1B parcel | 24.57 acres sold to the Tejon (60%) and Dedeaux Properties (40%) joint venture; $6.9 million, Q2 2026 |
| Price | Nestle: not disclosed. Hotel site: not disclosed. Building 1B: $6.9 million |
| Planned use | Nestle: owner-occupied distribution center of more than 700,000 SF. Building 1B: speculative Class A warehouse of about 510,000 SF, due early 2027 |
| Brokers | Not disclosed for the land sales; an exclusive leasing brokerage is marketing Building 1B |
What land did Tejon Ranch sell at TRCC in 2025 and 2026?
Tejon’s earnings reports show three land transactions. Tejon Ranch Co. owns the land under the Tejon Ranch Commerce Center at the foot of the Grapevine and decides, parcel by parcel, whether to sell, lease or develop. In its FY2025 results, the company said its “2025 results included two land transactions at TRCC, the sale of a hotel site and the back-end revenue recognition tied to the Nestle land sale.” A third, the $6.9 million Building 1B parcel, followed in the second quarter of 2026.
Each deal used a different structure, which is why they are worth reading together.
| Transaction | Buyer | Land | Price reported | Timing |
|---|---|---|---|---|
| Nestle distribution center site | Nestle USA (owner-user) | About 58 acres | Not disclosed; $2.373M deferred revenue recognized | Sold 2022; revenue recognized Q3 2025 |
| Hotel site | Not disclosed | Not disclosed | Not disclosed | 2025 |
| Building 1B parcel | Tejon (60%) and Dedeaux Properties (40%) joint venture | 24.57 acres | $6.9 million | Q2 2026 |
Sources: Tejon Ranch Co. Q3 2025, FY2025 and Q2 2026 results; Tejon release, Jan. 23, 2024; Tejon and Dedeaux release, May 4, 2026.
How did Nestle’s 58 acres become a 2025 revenue item?
Nestle bought the land in 2022, and Tejon booked the last piece of revenue in 2025. Nestle USA bought about 58 acres on the east side of TRCC, according to a January 2024 Tejon release. Neither company disclosed the price. Tejon’s Q3 2025 results say the land sale “occurred in 2022,” and that Tejon recognized $2,373,000 of land-sales revenue and $595,000 of additional gross margin in 2025 “following the fulfillment of the performance obligation related to the Nestle land sale.”
That is a common pattern in master-planned land sales. When a seller still owes work after closing, accounting rules hold back part of the revenue until the work is done. Tejon did not describe the obligation, but the timing matches the building: Nestle completed construction of the facility, which both companies put at more than 700,000 square feet, in July 2025.
Nestle opened the center on June 10, 2026. Its release places the center in Arvin, while Tejon describes the site as the east side of TRCC. Nestle cites an investment of more than $330 million, more than 110 high-skilled jobs and the largest automated storage and retrieval system in its global network. The center serves the West Coast with brands such as Toll House, Coffee mate and Gerber. “Our investment in the new Arvin Distribution Center reflects how we’re building Nestle for the future,” said Marty Thompson, CEO of Nestle USA.
For Tejon, an owner-user sale converts land to cash once, with no rent to follow. For Nestle, owning the land made sense for a building this specialized, since a nine-figure automated system is not something a user wants to place on a landlord’s property.
What do we know about the 2025 hotel site sale?
Very little. Tejon’s FY2025 release confirms the sale of a hotel site at TRCC but does not name the buyer, the acreage or the price. The surrounding numbers explain the demand. Tejon said that in December 2025, after the neighboring Hard Rock Tejon Casino opened, fuel and food revenue rose at the TA Petro Travel Center and the Outlets at Tejon “generated its highest retail sales of any month ever.”
TRCC’s commercial portfolio totaled 620,907 square feet and was 98% leased at the end of 2025. Tejon’s 2025 annual report shows 282,063 square feet of commercial and retail entitlements remaining, out of 956,309 entitled. Commercial pads like this hotel site are a limited and shrinking supply.
What did the $6.9 million Building 1B land sale cover?
It covered the 24.57-acre site for Building 1B, sold to a venture in which Tejon holds 60%. Tejon’s Q2 2026 results report “the $6.9 million land sale associated with the Dedeaux Properties joint venture,” in which Tejon “holds a 60% economic interest.” The parcel is the site of a Class A warehouse of about 510,000 square feet with 36-foot clear height and 100 dock-high doors. The partners broke ground in May 2026 for delivery in early 2027. Our Building 1B construction article covers the building in detail.
Why sell land to a venture you control? Tejon’s annual report says the Dedeaux venture was formed in late 2024 to build the warehouse “subject to the execution of construction financing.” Construction lenders generally want the land owned by the borrowing entity. Selling the parcel into the venture puts the land where the loan needs it, gives Tejon cash for the land and still leaves Tejon with 60% of the building’s future value.
Because Tejon sits on both sides, the $6.9 million is an affiliated price, not a clean market comparable. It is still a useful marker.
| Measure | Figure |
|---|---|
| Land price | $6.9 million |
| Land area | 24.57 acres (about 1,070,269 SF) |
| Price per acre | About $280,800 |
| Price per SF of land | About $6.45 |
| Planned building | About 510,000 SF |
| Building coverage | About 48% of the site |
A coverage ratio near 48% is typical for a cross-dock distribution building, which needs deep truck courts on two sides plus trailer and car parking.
Why does Tejon use joint ventures instead of selling all its land?
Tejon says joint ventures give it access to capital and let it share risk. The 2025 annual report states the logic plainly: “We use joint ventures to advance our development projects at TRCC. This allows us to combine our resources with other real estate companies and gain greater access to capital, share in the risks of real estate developments and share in the operating expenses.” Its five ventures with Majestic Realty operate five fully leased buildings totaling more than 2.8 million rentable square feet.
In practice TRCC uses three models, and each trades upside for certainty differently.
| Model | TRCC example | What Tejon gets | What Tejon gives up |
|---|---|---|---|
| Land sale to an owner-user | Nestle (about 58 acres, 2022); IKEA’s 1.8 million SF center begun in 2000 | Cash at closing; a credit user that draws others | All future rent and appreciation on that parcel |
| Land sale to a developer | Dedeaux bought about 12.2 acres west of I-5 in 2022, built 233,000 SF and sold it in 2024 for $37.1 million | Cash at closing with no construction risk | The developer’s profit on the building |
| Joint venture | Majestic Realty ventures (2.8 million SF); Dedeaux Building 1B (60/40) | Land value plus a share of rent and resale value | Capital at risk during construction and lease-up |
Sources: Tejon Ranch Co. 2025 annual report, Q2 2026 results and Jan. 23, 2024 release; Commercial Observer, March 19, 2024.
The pattern is sensible. Tejon sells when a user needs to own its building or when a pad suits a single operator, such as a hotel. It joins ventures on speculative warehouses, where long-term rent and resale value can be worth more to the landowner than a one-time sale. For build-versus-wait choices on your own project, see our guide to build-to-suit and spec industrial development, and for the lease alternative, our explainer on ground leases.
Dedeaux’s 2024 sale shows what a finished, leased TRCC building can be worth. At about $159 per square foot ($37.1 million for 233,000 SF, by our math), it sits well above the Bakersfield average of $123 per square foot that regional brokerage reports showed for Q2 2026.
Why do users keep buying at TRCC?
Users buy at TRCC for freeway access, available entitled land and a proven tenant base. TRCC sits where Interstate 5 and Highway 99 meet at the south end of the San Joaquin Valley. Tejon’s May 2026 release places it 75 miles north of Los Angeles, with I-5 access and connections to the I-15 and I-40 corridors via Highway 58, and says the park employs about 5,000 people. Tejon’s October 2024 joint venture announcement put it about 60 miles north of Los Angeles, so mileage figures vary by release. Tejon’s 2.8 million square feet of joint-venture industrial space was 100% leased at mid-2026. Our guide to Kern County logistics along I-5, SR 99 and SR 58 explains the corridor.
Nestle fits the demand profile. A national brokerage’s South Central Valley Q2 2026 report says “Food & Beverage and Logistics tenants continue to represent the largest share of requirements in the South Central Valley, accounting for 40% of total tenants in the market.” Developers are betting on the same story. “TRCC remains one of the most compelling development sites in the state,” Brett Dedeaux, CEO of Dedeaux Properties, said in the May release.
What do Tejon Ranch Commerce Center land sales mean for Kern County industrial land?
They show a landowner pacing supply. Regional brokerage data put Bakersfield industrial vacancy at 9.55% in Q2 2026, down from 10.90% in Q1, with 1,489,196 square feet of positive net absorption over 12 months, in a Q2 2026 report. A national brokerage report counts only one Bakersfield-area building under construction, at 510,000 square feet, which matches Building 1B.
Tejon also has room to keep going. Its annual report lists 19,300,941 square feet of TRCC industrial entitlements, with 8,201,864 used and 11,099,077 remaining at the end of 2025. Tejon’s releases give other size measures, including 7.1 million square feet of leasable space, because each counts something different. Entitled, serviced land at a freeway junction is the scarce input in big-box development, and at the Grapevine that land belongs to Tejon.
For owners of large, older distribution buildings in Bakersfield and Shafter, the takeaway is competition. A tenant moving in 2027 will have a new 36-foot-clear option on I-5. For land sellers elsewhere in the county, the $6.45-per-square-foot Building 1B figure is a useful, if affiliated, reference point for entitled industrial land at a freeway interchange.
What happens next?
- Building 1B: Tejon’s Q2 2026 report says the building is on track for early 2027, and an exclusive leasing brokerage is marketing it to one or more tenants.
- Nestle: the Arvin center is open as of June 2026.
- Hotel site: Tejon has not named the buyer or the timing.
- Grapevine: Tejon expects subdivision mapping in Planning Area 6A, next to TRCC, from 2026 to 2028, which would add housing near the jobs. See our report on the Grapevine plan amendment.
- Next disclosure: Tejon’s third-quarter 2026 results should update Building 1B construction and any new TRCC land sales.
Frequently asked questions
What land has Tejon Ranch sold at Tejon Ranch Commerce Center recently?
Tejon reported three transactions. It booked 2025 revenue tied to Nestle USA’s 2022 purchase of about 58 acres, sold a hotel site in 2025 on undisclosed terms and sold the 24.57-acre Building 1B parcel to its Dedeaux Properties joint venture for $6.9 million in the second quarter of 2026.
How much did the Tejon Ranch Building 1B land sell for?
The reported price is $6.9 million, or about $280,800 per acre and $6.45 per square foot of land. Tejon owns 60% of the buying venture, so the number is an affiliated price. It is a reference point rather than a pure arm’s-length comparable.
How big is Nestle’s distribution center at Tejon Ranch?
Nestle and Tejon both describe it as more than 700,000 square feet, on roughly 58 acres. Construction finished in July 2025, and the center opened June 10, 2026, under an Arvin address. Nestle cites more than $330 million invested, more than 110 high-skilled jobs and the largest automated storage system in its global network.
Why does Tejon Ranch use joint ventures instead of selling all its land?
Joint ventures bring in partner capital, spread development risk and share operating costs, according to Tejon. A land sale pays once, while a venture keeps a share of rent and future value. Tejon sold to owner-user Nestle but uses ventures with Majestic Realty and Dedeaux Properties for speculative warehouses.
Is industrial space available at Tejon Ranch Commerce Center?
Not in the existing buildings. Tejon’s 2.8 million square feet of joint-venture industrial space was fully leased on June 30, 2026. The next new space is Building 1B, a Class A warehouse of about 510,000 square feet due in early 2027 and marketed by an exclusive leasing brokerage. About 11.1 million square feet of industrial entitlements remained at the end of 2025.
Where is Tejon Ranch Commerce Center?
It sits in unincorporated Kern County near Lebec, where Interstate 5 and Highway 99 meet at the south end of the San Joaquin Valley. Tejon’s May 2026 release places it 75 miles north of Los Angeles, with connections to the I-15 and I-40 corridors via Highway 58. The park employs about 5,000 people.
Weighing a land sale, a joint venture or a build-to-suit on industrial land in Kern County? Call Kern CRE at 855-KERN-CRE (855-537-6273) or contact us. Get Kern County CRE news monthly: subscribe to the Kern CRE report.
Sources
- Tejon Ranch Co., Tejon Ranch Co. Announces Third Quarter 2025 Financial Results, Tejon Ranch Co., Nov. 6, 2025.
- Tejon Ranch Co., Tejon Ranch Co. Announces Fourth Quarter and Year-Ended December 31, 2025 Financial Results, GlobeNewswire, March 19, 2026.
- Tejon Ranch Co., Tejon Ranch Company Announces Second Quarter 2026 Financial Results, Tejon Ranch Co., Aug. 6, 2026.
- Tejon Ranch Co., Form 10-K for the year ended Dec. 31, 2025, U.S. Securities and Exchange Commission, 2026.
- Tejon Ranch Co. and Dedeaux Properties, Tejon Ranch Co. and Dedeaux Properties to Break Ground on 510,000-Square-Foot Industrial Facility, GlobeNewswire, May 4, 2026.
- Nestle USA, Nestle USA Opens Its Largest and Most Technologically Advanced Distribution Center in Arvin, California, Nestle USA, June 10, 2026.
- Tejon Ranch Co., Nestle Joins Growing List of National and Multinational Companies Operating at the Tejon Ranch Commerce Center, Tejon Ranch Co., Jan. 23, 2024.
- Commercial Observer, Dedeaux, Basis Investment Group Sell Tejon Ranch Facility to Clothing Distributor, March 19, 2024.
- Tejon Ranch Co., Industrial Properties in the Original Section of Tejon Ranch Commerce Center West of Interstate 5 Completely Sold Out, GlobeNewswire, Feb. 10, 2022.
- CBRE, South Central Valley Industrial Figures Q2 2026, CBRE, Aug. 3, 2026.
- Lee & Associates, Q2 2026 Bakersfield, CA Industrial Market Report, July 2026.
- Cushman & Wakefield, Bakersfield Industrial MarketBeat Q2 2026, Q2 2026.
About this article
Kern CRE prepared this article with help from AI research and writing tools. An editor reviewed the draft, checked its facts against the sources linked above and edited it for accuracy and clarity. Details come from public records and the sources cited; unless stated, Kern CRE and ASU Commercial were not involved in the transaction or project.