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Flurry of Investment Sales Ends First Quarter

3 Apr 2014, 10:10 pm

By Alex Girda, Associate Editor

San Diego’s commercial real estate market wrapped up the first quarter of 2014 with a productive week as industrial, office and residential properties changed hands in various submarkets.

Doerken Properties acquired the Flags on Mission Shopping Center in Oceanside. The investor purchased the 107,600-square-foot property for $12.6 million from Mission Avenue Investors. Two Lee & Associates principals, Marc Dudzik and Bo Havlik, arranged the sale.

On the industrial front, PB Miramar Distributions L.L.C.. acquired three Miramar buildings Palomar Partners L.P. in a $6.5 million transaction, according to the San Diego Business Journal. Totaling 74,000 square feet, the buildings were constructed in 1971, 1984 and 1985. The new owner will initially occupy more than half of the space and will eventually expand into the entire complex.

In residential news, Newport Beach-based Doug Wetton Properties Inc. paid Pacifica Cos. of San Diego $5.7 million for Kenora Terrace, a multi-family property in Spring Valley. According to SDBJ, the property located at 3541 Kenora Drive is a 35-year-old 46-unit community located on a 2.5-acre lot. HFF arranged the sale and secured about $4 million in acquisition financing for Wetton Properies.

And in a downtown San Diego office deal, Long Beach-based Rossi-Kettner L.L.C. bought 1717 Kettner Blvd. for $5.3 million. Totaling 17,276 square feet, the property is fully leased, according to CoStar Group. The seller was the Pastula Family Trust.



Wateridge Plaza Sale Leads Flurry of Office Trades; AleSmith Brewing Opts for Bigger Home

31 Mar 2014, 4:06 pm

By Alex Girda, Associate Editor

In a busy week for local transactions, a joint venture of Parallel Capital Partners and Sam Zell’s Equity Group Investments paid $72.5 million for the Wateridge Plaza in Sorrento Mesa, The buyers acquired the three-building Class A office complex from Beacon Capital Partners and C-III Realty.

Also changing hands was the Carmel Mountain Ranch office building, a 59,062-square-foot asset located at 15175 Innovation Drive. Los Angeles-based Century Park Partners L.L.C. sold the property to T JT & TP Investment L.L.C. for about $7.8 million. According to the San Diego Business Journal, David Crabb of CBRE Group Inc. handled the transaction of behalf of the buyer, while JLL’s  Jay Alexander and Ryan Grove represented the seller. The building is located at the Carmel Mountain Corporate Center and is currently fully leased.

In Solana Beach, Fair Oaks Valley, L.L.C. acquired a 14,100-square-foot, two-story office building at 265 Santa Helena in a $4.3 million deal, according to rentv.com. Propco L.P. sold the 33-year-old property as part of a 1031 exchange. Ashcraft Investments represented the buyer while Propco was represented by a team from CBRE.

In other commercial real estate news, AleSmith Brewing Co., is planning to move from its current home on Cabot Drive in Miramar to a new, 105,600 square-foot facility at 9990 Empire St., the San Diego Business Journal reports. The company has signed a $9.7 million lease for the entire space with the building’s owner, Westcore Properties. AleSmith will nearly double its current workforce of 27 by adding 25 new jobs once its moves into its new home. The new facility will also enable the brewer to increase production from 15,000 barrels this year to 25,000 in 2015. Move-in is scheduled for January 2015,



Retail Opportunity Investments Buys Poway Center for $40M

21 Mar 2014, 8:40 pm

By Alex Girda, Associate Editor

Creekside Plaza, a 128,852-square-foot retail center in Poway, has been acquired by  San Diego-based Retail Opportunity Investments Corp. in a $43.9 million deal. The transaction was arranged by a team of HFF representatives, who worked on behalf of seller Azure Creekside Corp., a Glendale, Calif.-based company. Azure is a client of American Realty Advisors, which handled the sale of the asset.

The property is a star performer in the area in terms of its good occupancy and solid tenant roster in an active submarket . According to rentv.com, the retail center consists of six buildings located at 13409-13595 Poway Road. It was built in 1993 and was most recently renovated in 2005. At the time of the transaction, the property was fully leased.

Creekside Plaza is  anchored by a Stater Bros. grocery store and a Digiplex cinema. Tenants include  Chipotle, FedEx Office, Jiffy Lube, Starbucks and Baskin-Robbins. John Jennings of Cushman & Wakefield Inc. serves as leasing representative.

Retail Opportunity Investments specializes in necessity-based community and neighborhood shopping centers anchored by  national supermarket brands and drugstores. At the end of last year, the company’s portfolio totaled 5.8 million square feet at 54 properties.  



HFF Secures $23.5 Million Financing Package for 2 National City M-F Properties

16 Mar 2014, 10:28 pm

By Alex Girda, Associate Editor

HFF recently secured financing for two National City multifamily complexes owned by PCD Capital Group and Birge & Held Asset Management. The firm worked with Opus Bank on behalf of the borrower, and completed two financing deals worth a total of $23.5 million. The HFF team in charge of securing the loans was headed by Zach Koucos.  

The two communities are located in National City and offer a total of 141 residential units. Centro Apartments and Harborview Apartments are Class A multifamily properties situated five blocks apart. HFF provided a $14.2 million fixed-rate loan for Harborview, while Centro received a $9.3 million loan. Both deals carry 10-year terms with initial fixed-rate periods of five years on a non-recourse basis, a statement announcing the deal shows.

Centro Apartments is located about four miles south of downtown San Diego at 45 East 12th Street in National City. The four-story building offers 60 residential units averaging 959 square feet. Resident amenities include a pool, a barbecue area, common sundeck, and ground-level enclosed parking.

Harborview Apartments offers 81 residences including studios, one- and two-bedroom units, loft and brownstone-style apartments.  Completed in 2011, the complex offers a resident amenity package that features a rooftop pool and spa, a fitness facility and a business center equipped with computers, a printer and work stations, WiFi Internet access, laundry facilities, gated entry and reserved parking.

Photo of Centro Apartments courtesy of Facebook account: facebook.com/centroapts/

Image of Harborview Apartments courtesy of rental-living.com

 

 



JH Real Estate Partners Buys San Carlos Shopping Center for $35 Million

10 Mar 2014, 2:25 am

By Alex Girda, Associate Editor

 In a $35 million deal, JH Real Estate Partners has acquired the San Carlos Shopping Center, a 125,700-square-foot retail center in the Lake Murray area. The seller, an unidentified East Coast investor, had owned the asset since 2006.

Located on the Navajo Road exit of the 125 Freeway, the property has a eclectic tenant roster that includes such national brands as Walgreens, LA Fitness, Chase Bank and Starbucks.

According to rentv.com, the facility currently operates at an occupancy rate of around 81 percent. Around 25,000 square feet are currently available for lease, which could accommodate two new junior anchors. The new owner will look to bring some improvements to the property, in order to reposition the shopping center and boost its revenue.

In recent years, an already well performing retail market has tightened further, considerably outperforming the national average since the end of 2013. According to Marcus & Millichap Real Estate Investment Services shows that at the end of 2013, the San Diego Metro area had a projected average vacancy rate of around 4.6 percent, compared to the 7.1 nationwide average rate.

Chart courtesy of Marcus & Millichap Real Estate Investment Services Inc. at marcusmillichap.com



Alliance Diversified Buys Pyramid Building in Miramar, Plans Makeover

3 Mar 2014, 10:46 pm

By Alex Girda, Associate Editor

One of the area’s most distinctive office properties recently traded hands as Alliance Diversified Holding, .L.L.C. paid $13.6 million for the Pyramid Building in Miramar.  The seller was APEX 1 & 2 L.P. Voit Real Estate Services arranged the sale;  a team consisting of Brandon Keith, Ryan Bracker and Bob Brady represented the seller.

Located at 7310 Miramar Road, the six-story pyramid-shaped building was initially part of the Miramar Metroplex and offers tenants a total of 131,218 square feet of  space.

Alliance Diversified reportedly plans to rebrand the property as the San Diego Innovation Center and inaugurate improvements designed to attract technology-related tenants.

When the Pyramid Building was completed in 1992, critics cited the unusual design by architect N. Charles Slert. Alliance Diversified now aims to “bring this dynamic property to its full potential as a creative shell in which creative companies will thrive”, said Ted Eldredge, president of Alliance Diversified, in a statement.



Kaiser Permanente Kicks Off $900M Hospital in Kearny Mesa

23 Feb 2014, 12:45 am

By Alex Girda, Associate Editor

Boosting San Diego’s cachet as a leader in medical care, Kaiser Permanente broke ground Feb. 14 on a $900 million medical center in Kearny Mesa.

Kaiser Permanente San Diego Central Hospital, the Oakland-based healthcare provider’s second in San Diego and its first new medical center in 40 years, will be located at 5201 Ruffin Road near Clairemont Mesa Boulevard.

According to information on the website of Hensel Phelps, which is handling construction, the seven-story, 566,000-square-foot main hospital building will offer 321 beds.

Also part of the complex will be a 38,000 square-foot energy center, a three-story, 55,000 square-foot support building and a  parking structure with 1,479 spaces. Kaiser may eventually expand the hospital’s capacity to 450 beds.

Previously, the project’s 19-acre site served as the location for several San Diego County departments, including the Registrar of Voters. In December, the registrar’s office relocated to a the recently completed County Operations Center at 5600 Overland Ave. in Kearny Mesa.

CO Architects is designing the facility, which Kaiser intends to submit  for LEED Gold certification.

Rendering courtesy of coarchitects.com



Venta, Pathfinder JV Buys Homewood Suites Hotel in La Quinta

14 Feb 2014, 12:18 am

By Alex Girda, Associate Editor

A joint venture of Vesta Hospitality and Pathfinder Partners L.L.C. has acquired a 129-key Homewood Suites hotel in La Quinta. Washington, D.C.-based Vesta, a hotel management and development company, and Pathfinder, a local real estate investment firm specializing in value-add opportunities, had previously handled management duties. Terms were not disclosed.

A $1.8 million renovation is planned for the newly acquired asset, which was built in 2007. Guest amenities include a business center, meeting rooms, a swimming pool, fitness facilities and dining facilities. Noted local institutions include the Berger Foundation,  JFK Memorial Hospital and the Betty Ford Center.

Metropolitan San Diego is drawing increasing attention from hotel developer. The SDTA Hotel Database projects that by the end of the year, 10 new hotels will have been completed since the summer of 2013. That translates to more than 800 new guest rooms added last year and nearly 1,000 more keys in 2014.

Image courtesy of homewoodsuites3.hilton.com



Starwood Hotels Plans 140-Key Aloft for Rancho Bernardo

5 Feb 2014, 5:02 pm

By Alex Girda, Associate Editor

Rancho Bernardo, which has established a reputation as one of San Diego’s high-tech magnets in recent years, is also commanding attention from the hospitality sector. Starwood Hotels & Resorts Worldwide plans a 2016 opening for a 140-key Aloft. Upon completion, the property will be the sixth Aloft in California.

The hotel will be located at the entrance of the Rancho Bernardo Corporate Park, where Sony, Hewlett-Packard, BAE Systems, Northrup Grumman, Teradata, Cymer, Millennium Laboratories, and other companies have regional offices. Aloft Rancho Bernardo will feature the brand’s signature loft-style rooms, 3,000 square feet of meeting space, a rooftop “Splash” swimming pool, a fitness center, underground parking, and Smart Check-In, a mobile service that allows guests to bypass the front desk.

Brian McGuinness, Starwood Hotels’ senior vice president of specialty select brands, said that the new facility will be “a great match for this bustling, high-tech hub and (will) likely emerge as a leading choice among savvy travelers and young professionals.”

Close to downtown San Diego and the San Diego International Airport, the Rancho Bernardo location offers entertainment and leisure options that include the Bernardo Winery, San Diego Zoo Safari Park, shopping, several golf courses and a variety of outdoor activities.



Starwood Capital Taps Cassidy Turley To Manage 1 MSF Office Portfolio

23 Jan 2014, 4:19 pm

By Alex Girda, Associate Editor

After completing the blockbuster $327 million acquisition of a San Diego-area office portfolio from Kilroy Realty Corp., Starwood Capital Group has tapped Cassidy Turley to manage the properties.

Totaling 1.1 million square feet, the 12 properties are located in two of San Diego’s best- performing submarkets: eight in Rancho Bernardo and  four Sorrento Mesa.

At closing, the assets were about 9 percent vacant, well below the 15.8 percent average Class A vacancy rate in San Diego reported for the third quarter by Marcus & Millichap Real Estate Investment Services Inc. San Diego’s office market has continued to keep pace with the national decline in Class A vacancy, Marcus & Millichap confirmed.

For Cassidy Turley, the assignment is the largest to date for the firm’s southwest property management unit since its launch in 2010, rentv.com
noted. The Starwood commission brings Cassidy Turley’s local property management portfolio to about 6 million square feet and 35 million square feet in California and Arizona.

  

Chart courtesy of Marcus and Millichap Real Estate Investment Services at marcusmillichap.com



Math+Science Complex Completed at San Diego Mesa College

11 Jan 2014, 8:02 pm

By Alex Girda, Associate Editor

Last year ended with the completion of one of San Diego’s largest new educational facilities: the $109 million Math+Science Complex at San Diego Mesa College.

Also the college’s largest project to date, the four-story facility will provide classrooms, laboratories, faculty space and administrative support space for science and mathematics students when it opens this spring.

The 206,000-square foot project is the first building in the San Diego Community College District to be delivered through a combination of design-build, design-assist and multi-prime construction management methods.

McCarthy Building Companies Inc. used structural steel, concrete shear walls and an exterior curtain wall in the project’s construction. Funding was provided mostly by Propositions S and N construction bonds.

Designed by  Architects | Delawie Wilkes Rodrigues Barker, the Math+Science Complex features contemporary terrazzo flooring, stainless steel railings, aluminum wall panels and precast concrete stairways. The project is a candidate for LEED Silver certification. Sustainable features include recycled or renewable resources, such as the caramelized bamboo used for the building’s wood surfaces.



Lowe Wraps Third Phase of $500M County Campus in Kearny Mesa

13 Dec 2013, 3:53 pm

By Alex Girda, Associate Editor

In a milestone for a $500 million office county office campus in Kearny Mesa, Lowe Enterprises has completed the project’s third phase, a 118,500-square-foot headquarters for the Registrar of Voters. The LEED Gold-certified building will house staff offices, election ballot processing equipment and warehouse production space, as well as an art installation.

When complete, the 47-acre campus on Overland Avenue will encompass more than 1 million square feet of facilities for San Diego County.

 The second phase, completed in August 2011, consists of two four-story office buildings totaling 150,000 square feet, a 15,000 square-foot, LEED Platinum-certified conference center and a cafeteria.

Phase one debuted in October 2010 and includes two 150,000-square-foot office buildings plus a seven-story, 1,000-space parking structure. Those buildings earned LEED Gold certification.

In addition to Los Angeles-based Lowe, the project development team comprises RJC Architects, Suffolk Roel Construction and Project Management Advisors. The county Department of General Services oversees the project on behalf of the Board of Supervisors.

Image courtesy of loweenterprises.com



Ballast Point Brewing Inks 107,000-SF Lease with HG Fenton in Miramar

29 Nov 2013, 11:09 pm

By Alex Girda, Associate Editor

 As metropolitan San Diego’s residential picture improves, the industrial market is also attracting renewed activity. Ballast Point Brewing and Spirits, a local craft brewer, signed a 15-year lease for 106,584 square feet at 9045 Carroll Way in the Miramar submarket. At $16 million, the value of the deal is one of the largest of its kind in the area this year.

Ballast Point will use the space as its main brewery, bottling and canning facility and plans to start production there by next summer. Voit Real Estate arranged the deal for Ballast Point and HG Fenton, the property’s owner.

San Diego’s industrial market appears positioned for growth through 2014, according to research by CBRE Group Inc.

Current average prices of about $12.60 per square foot could rise to nearly $13 per square foot by the third quarter of 2014. During the next 12 months, the vacancy rate could dip 70 basis points from its current average of slightly more than 8 percent, according to CBRE’s projections.

Chart courtesy of CBRE Global Investors at cbre.com



Oceanside M-F Asset Commands Record Per-Unit Price

19 Nov 2013, 6:27 pm

By Alex Girda, Associate Editor

Setting a new record for Oceanside , a 221-unit rental townhouse property there has traded for $366,516  per unit.

In an $81 million deal, a joint venture of TruAmerica Multifamily and Guardian Life Insurance acquired the asset, named Piazza d’Oro, from ConAm Group, the San Diego Union-Tribune reported.

Located on a 14-acre site along the 78 corridor at 3402 Piazza de Oro Way, the upscale rental property was acquired by ConAm from K. Hovanian Homes, its original developer. K. Hovnanian had envisioned the project as a for-sale community, but stepped away from it after the recession hit.

According to the Union-Tribune, rents at Piazza d’Oro run between $2,250 to $2,550, and unit footprints range between 1,586 and 1,704 square feet. Ten units were still vacant when the transaction closed.

Image courtesy of piazzadorotownhomes.com



TDA Investment Group Pays $11.4M for MOB Near San Diego State

24 Oct 2013, 4:40 pm

By Alex Girda, Associate Editor

A healthcare facility near San Diego State University has come under new ownership. In an $11.4 million deal, TDA Investment Group has acquired Alvarado Hospital Medical Plaza III from seller AMP III L.L.C., according to rentv.com.

Located on a 2,.5 acre site at 6719 Alvarado Road, the three-building asset is part of the Alvarado Hospital Medical Center campus and was developed in 1991. The 51,441-square-foot building, which offers 224 surface parking spaces, had a 75 percent occupancy rate at the time of the transaction. Newmark Grubb Knight Frank represented TDA, and PMB Brokers represented AMP III.

Other recent San Diego-area deals include:

  • ·         Harvey Inc.’s acquisition of a 24,500-square-foot building in Kearny Mesa for $2.7 million. The seller was Lyons-Warren Partners, represented by Commercial Facilities Inc., while Cassidy Turley handled the deal for Harvey.
  • ·         CVG Properties acquired a 32-unit apartment complex at 480 Jamacha Road in El Cajon from  Rodney Johnson for $4 million.
  • ·         A 30,000 square-foot industrial property at 796 Energy Wayin Chula Vista fetched $1.65 million. Mark Ralph, the new owner, plans to use the building for office, storage and distribution functions. Volt Real Estate handled the transaction.

 



PREI Pays Reported $57M for Mission Valley Office Building

3 Oct 2013, 9:19 pm

By Alex Girda, Associate Editor

In another sign of San Diego’s strengthening office sector, Prudential Real Estate Investors bought Rio San Diego Plaza  in the Mission Valley submarket. The seller, AEW Capital Management, had owned the he 189,490-square-foot asset since 2006 and sold it on behalf of an institutional client.

AEW was represented by Jones Lang LaSalle Inc. Managing Directors Lynn LaChapelle and Bob Prendergast, according to the San Diego Business Journal.  Rio San Diego Plaza commanded a price of $56.8 million, the Business Journal reported.

Located at 8954 Rio San Diego Drive, the six-story building earned LEED Silver certification about a year ago. The property has also earned a TOBY award from Building Owners and Managers Association International, as well as design awards.

Mission Valley is a strong submarket, with median office vacancy at about 10 percent, according to Jones Lang LaSalle. With local unemployment declining, the buyer  identified a strong investment opportunity in a market characterized by thriving  biotechnology and education sectors. Office absorption is also on the rise, exceeding 850,000 square feet by mid-year, Jones Lang LaSalle reported.



Alvarez & Marsal, Classical Academy Buy Industrial Assets

19 Sep 2013, 6:25 pm

By Alex Girda, Associate Editor

A pair of industrial assets figure in several notable recent San Diego transactions. In a $7 million deal, The Classical Academy acquired a 57,104-square-foot facility formerly operated by the defunct North County Times, the San Diego Business Journal reported.

The property was acquired from Manchester Financial Group, a company controlled by Douglas Manchester, the developer, investor and owner of the San Diego Union-Tribune. Located at 207 E. Pennsylvania Ave., the four-acre site includes two undeveloped parcels as well as the building.

Alvarez & Marsal Capital Real Estate paid $12.7 million for a 65,840-square-foot square-foot research and development building at 2251 Faraday Ave. in Carlsbad, according to SDBJ. IDS Real Estate Group of Los Angeles was the seller. The facility is 73 percent leased to pharmaceutical and medical device maker Abbott Laboratories. Cassidy Turley and Madison Partners arranged the transaction.



County’s Economic Index Still Rising, Even as Pace of Job Gains Slows

5 Sep 2013, 7:51 pm

By Alex Girda, Associate Editor

San Diego County’s economy seems to taking a steady upward course as a host of indicators continue to improve, if at a slower pace than earlier in 2013.

According to the USD Burnham-Moores Center for Real Estate’s economic index for July, the county’s indicators improved 0.7 percent to 127.5, its highest level in more than four years. That marks the index’s 11th consecutive increase and 19th in the past 20 months.

Building permits rose 1.25 percent in July, and consumer confidence posted a 1.4 percent increase. Meanwhile, the San Diego Stock Exchange Index rose 0.73 percent.

While the county is still adding jobs, the pace of those gains appears to be slowing. About 19,900 jobs were added in July 2013, considerably fewer than earlier in 2013, when the monthly tally regularly exceeded 30,000. The index suggests that policy issues, such as the expiration of the payroll tax cut and the sequester, could be contributing to the slowdown.

Another hint that improvement in the job market is slowing is the 0.77 percent month-over-month decline in the index for initial unemployment claims. Additionally, a large portion of San Diego County’s new jobs are part-time and low-wage.

Chart courtesy of hribar.com



Kiernan Cos. Buys 10 Acres in Otay Mesa

21 Aug 2013, 10:27 pm

By Alex Girda, Associate Editor

With declining vacancy likely for San Diego’s industrial market, the recent sale of a sizeable parcel in Otay Mesa border offers reasons for additional encouragement. Coronado-based Kiernan bought the parcel from MS Development Co. LLC. for $3.6 million. The deal was arranged on behalf of the seller by a CBRE Inc. team, while Kiernan was represented by Fischer & Co.

Located at 10138 Airway Road  five blocks north of the U.S.-Mexico border, Airway Business Park is near State Route 11, a new road that officials are counting on to improve traffic flows through the border region.

According to research from Marcus & Millichap Real Estate Investment Services Inc., San Diego’s projected industrial vacancy rate by the end of the year is 9.4 percent. That is notably higher than above other West Coast port markets like Los Angeles (5.0 percent), Oakland (8.9 percent) and Seattle-Tacoma (5.1 percent), as well as the projected national average of 8.4 percent.

That said, a 9.4 percent vacancy rate at year’s end would represent a 70 basis-point improvement compared with 2012. San Diego ranks 17th in Marcus & Millichap’s National Industrial Index, four places ahead of its position in last year’s index.

Chart courtesy of Marcus & Millichap Real Estate Investment Services Inc. at marcusmillichap,com



Vista Industrial Asset Fetches $5.6M

10 Aug 2013, 11:15 pm

By Alex Girda, Associate Editor

A 65,000-square-foot industrial asset in Vista has been acquired by B Group Holdings Inc. for $5.6 million. Located at 1081 Poinsettia Ave., the property is entirely leased to Brown Safe Manufacturing, which uses the building as its headquarters and manufacturing facility. Last year Brown signed a 90-month, $3.4 million lease on the property.

Joe McDermott of Cushman & Wakefield Inc. represented the buyer, while Colliers International’s Henry Zahner and John Busse represented the seller, Symphony Asset Pool XIV.

According to Zahner, a Colliers senior vice president, the transaction is “a continued indication of the slowly improving economy and financing markets.”

According to Colliers, Brown Safe Manufacturing will continue to operate the industrial facility for the remainder of its contract. The facility also includes 9,000 square feet of office space, upgraded sprinkler facilities and extensive glass lines.

The sale was an “opportunity to once again work with Symphony Asset Pool XIV and the buyer’s agent to successfully complete the transaction,” Zahner said.







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