A fast-growing power company founded by a former Tesla executive is delivering a hefty real estate boost to a quiet segment of California’s Bay Area.
Heron Power, founded by Drew Baglino and fresh off a $140 million funding round, is behind one of the largest leases ever signed in Scotts Valley, where the company is seeking to bridge the talent and innovation corridors of Santa Cruz, Watsonville, the Peninsula and the South Bay.
Formerly named Automated Power, Heron was born out of the need to modernize and scale the nation’s aging energy infrastructure amid the next wave of power‑electronics advancement for artificial intelligence. Heron Power focuses on solar, battery systems, and high‑efficiency technologies that align with California’s clean‑energy goals — and its growth trajectory is already reshaping the local business landscape.
Heron expanded in a follow-on deal to give it full occupancy of this Scotts Valley flex building, less than five miles from the Santa Cruz Highway, marking a welcome boost for “a down market,” according to Cushman & Wakefield Managing Director Reuben Helick. Heron is making a big impact on the market by bringing in top engineering and R&D talent from across the Bay Area, and is expected to add hundreds of jobs in the coming year.
The lease earned a 2026 CoStar Impact Award, as judged by a panel of local real estate professionals.
About the project: Heron initially leased approximately 18,000 square feet in December before expanding by an additional 13,000 square feet in March, bringing its total footprint to roughly 24,500 square feet under a four‑year term. The project includes targeted tenant improvements, including the construction of a dividing wall, exterior painting, refreshed landscaping, and updated awnings and outdoor seating.
What the judges said: “It’s a rare deal of this size and term in the county,” said Matt Shelton, owner and broker at J.R. Parrish Commercial Real Estate.
They made it happen: Ritchie Commercial President Mark Ritchie and Associate Alexandra Stein represented the tenant. Randy Parker and Henry Horowitz of J.R. Parrish Commercial Real Estate represented the landlord.