In what could be a major economic boon for the city, a massive Amazon warehouse is slated to open in Milpitas in the next few years, serving as its first same-day deliver facility in the South Bay.
Milpitas City Council approved the plans for the new warehouse Tuesday night despite disputes over environmental review and labor negotiations.
“I think this is a wonderful thing,” said Milpitas Mayor Carmen Montano. “It’ll really improve the site and it’ll create a lot of jobs and furthermore will create sales tax.”
For decades, 1000 Gibraltar Drive was used as a corporate campus with four industrial office buildings. While medical device company Lifescan, Inc. operated on the site for nearly three decades, it left in 2015 and the site has been vacant since 2018.
Since 2021, the site has been eyed for a warehouse project, with an application to demolish the existing buildings to make way for a single warehouse of nearly half a million square feet approved that year. Amazon then bought the rights to build the warehouse, but held off on construction during the economic upheaval of the pandemic. After reapplying in September 2024 with an updated plan for the warehouse, the plan was approved by the Milpitas Planning Commission September 10.
The project consists of a 487,564 square foot, one-story industrial building with office space on the nearly 29 acre site. The warehouse would be a specialized delivery center meant to allow for delivery of certain Amazon products in a four-to-five hour window using gig-style delivery drivers to ship out goods.
There are only two other same-day delivery facilities in the Bay Area — in Richmond and Brisbane serving San Francisco and the East Bay — and Amazon representatives say the new warehouse will expand same-day delivery to the South Bay.
“We are looking forward to expanding our same-day delivery capabilities in the Bay Area, offering customers even faster delivery options in Santa Clara County and surrounding communities,” said Amazon spokesperson Natalie Banke.
The site is expected to create over 360 jobs on the site, not including the gig-style drivers, according to a report by city staff.
Soon after approval, however, Mitchell M. Tsai Law Firm filed an appeal on behalf of Carpenters Local Union No. 405, arguing that the project’s expanded footprint would require additional review to ensure there wouldn’t be impacts to potential flooding at the site and asked the project approval to be revoked.
Still, the developer said that this expansion – around a 6% increase in the relevant area of the site – was well within the scope of the regular approval process, and Milpitas city staff argued that the updated site would actually decrease flood risk at the site by updating the site to modern standards.
While representatives for the Carpenters Local Union 405, maintained that the dispute was about environmental issues, much of the commentary from the public focused not on minutiae of drainage standards, but the labor that would be building the project. The council chambers was packed with members of different unions in yellow and orange vests, who stood up in alternating groups as their members spoke.
“We believe (families in Milpitas) will be directly impacted by the environmental consequences of this project,” said Doug Chesshire, senior representative for the Carpenters Local Union No. 405, which would not be working on the project. “The city should require this project to build with contractors, hire locally, pay prevailing wages, provide health care and utilize apprentices from state certified apprenticeship training programs.”
Still, the project’s developer, Panattoni Development Company, argued it had long-standing relationships with unions, many of whom had local workers on the projects.
“This isn’t a flood or drainage issue – it’s about a labor agreement,” said Steve Beauchamp Senior Development Manager at Panattoni Development Company. He maintained that the developer had partnered with six unions for this project, and several members of those unions stood in support of the warehouse’s approval.
“I just want to ask for your support in this project, because you’re not only putting money and food on the table for the people working there, but also … for the people that are going to be working in that building,” said Jose Arriaga of the Laborers International Union of North America 270. “God bless the carpenters, but there are many other unions that are going to be working on this project.”
Following the arguments, the City Council decided to dismiss the environmental appeal and voted unanimously to approve the plan for the project.
While the project still needs to clear some bureaucratic hurdles, the approval clears the most significant hurdle for the warehouse. According to city documents, construction is slated to begin in early 2026 and the project should open in early 2027.