SAN JOSE – A longtime San Jose property where a veteran manufacturer has operated for decades has been purchased by an East Coast-based real estate development and investment firm.
The plant, located on 10th Street near Tully Road, was purchased by a subsidiary controlled by Clarion Partners, according to documents filed with the Santa Clara County Recorder’s Office.
LIT South 10th Street, the subsidiary of Clarion Partners, paid $22 million for the factory building and the seven acres of land below at 2250 South 10th St. in San Jose, county records show.
New York-based Clarion Partners paid cash for the property, according to public filings.
Clarion is a property company which arranges and manages a range of investment and property development projects on behalf of the company’s clients.
“With its convenient location near major airports and transportation arteries, the property provides convenient access to densely populated areas,” said Michael Marrone, Clarion’s chief executive.
The seller was Burke Industries, according to county records. The site is behind a Costco store at Senter Road and Burke Street.
Burke Industries manufactures rubber and plastic products used for roofs, siding and blankets at its San Jose site. The company was founded in 1942 and operated for decades as a family business until the Burke family sold the business to a Wall Street firm through a leveraged buyout.
“The business started as a family business, in my grandfather’s basement, where the family was doing odds and ends,” said Michael Burke, who worked in the business alongside his father. Norman Burke and his uncle Halsey Burke. “It was hard work, but good pay. Working at the factory was hot, it was hard, but it was worth it.
Burke Industries, more than a decade after the family sold the company, filed for bankruptcy in 2001. The company emerged from bankruptcy in 2002.
In 2008, Mannington Mills, a New Jersey flooring company, acquired Burke Industries. Burke became a wholly owned unit of Mannington Mills through the transaction, but retained its brand name.
At the time, Mannington Mills viewed the acquisition of Burke as a way to diversify its line of commercial hard surface floors.
Mannington Mills did not respond to a request for comment.
In 2018, about a decade after buying Burke Industries, Mannington Mills embarked on a venture to build a plant in Georgia that would produce flooring products.
The Georgia flooring plant built by Mannington has retired a key product line from the Burke plant in San Jose.
The Burke San Jose factory, beginning in 2019, began focusing primarily on manufacturing what it called environmental products and custom rubber products, the Burke San Jose president said at the time. , Bob Pitman.
“The sale of the property doesn’t necessarily surprise me,” Michael Burke said. “Santa Clara Valley isn’t too favorable for heavy manufacturing, as far as the cost of making products goes.”
The San Jose plant is in an area known to contain prime locations for the redevelopment and construction of modern industrial and logistics buildings.
In October 2020, Amazon.com Services paid $59.3 million for a 17.8-acre site about a mile away on South Seventh Street.
The property which has just been acquired seems to offer development opportunities for Clarion Partners.
“Overall, San Jose is unique as a distribution location,” Marrone said. “We are confident in the long-term potential for future redevelopment.”
If and when the plant goes out of business, another important chapter of American industry will come to an end.
Over the decades, Burke Industries has produced countless flooring, roofing, swimming pools and carpets. Burke also manufactures a line of specialty items.
Among the items: products to help US Navy submarines run smoothly and O-rings for Titan III rockets launched from Vandenburg Air Force Base. Burke never produced O-rings for space shuttles. The company has obtained patents for several inventions.
“It was great to be able to walk into the factory and know your dad’s office was right there,” Burke said. “Now part of my family history is going away which is sad.”