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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.

ASB, Blatteis & Schnur Buy Trio of Gaslamp Retail Properties for $15.3M

24 Jul 2013, 11:06 pm

By Alex Girda, Associate Editor

Joint-venture partners ASB Real Estate Investments and Blatteis & Schnur Inc. have acquired a trio of retail buildings in the Gaslamp Quarter for $15.3 million, the companies said on July 23. ASB and Blatteis & Schnur bought the properties from Federal Realty Investment Trust, the Rockville, Md.-based REIT.

Located at 643, 653 and 665 Fifth Ave. between G and Market Streets, the properties are fully leased to a roster that includes Urban Outfitters, Ghirardelli Chocolate Co. and The Lime, a popular restaurant. The assets expand the footprint of the ASB-Blatteis & Schnur partnership, which also owns properties in Los Angeles and San Francisco.

Moreover, the acquisition marks the San Diego debut of ASB Allegiance Fund, a $2.7 billion vehicle focused on core assets in top urban markets.  ASB Real Estate Investments’ president & CEO, Robert Bellinger, explained in a statement that the Gaslamp  Quarter  “perfectly meets the Fund’s investment criteria for dynamic, urban infill markets that are well positioned to garner strong tenant demand over the long-term.”

Other recent acquisitions by ASB Allegiance Fund include Class A retail properties in New York City, Los Angeles, Miami, and Washington, D.C. The fund is an affiliate of ASB Capital Management L.L.C., which has $3.8 billion in assets under management on behalf of 180 institutional clients.


OliverMcMillan Sells Trio of East Village M-F Properties for $142M

11 Jul 2013, 4:51 pm

By Alex Girda, Associate Editor

OliverMcMillan has sold a trio of upscale multi-family properties in San Diego’s East Village for a reported $142 million, according to the San Diego Union-Tribune. The buyers are three newly created entities: The Lofts at 655 Apartment Holdings L.L.C., The Lofts at 677 Apartment Holdings L.L.C., and The Lofts at 707 Apartment Holdings L.L.C. The transaction was arranged by Kevin Mulhern, Rachel Parsons and Dixie Hall of CBRE Group Inc.

Developed between 2006 and 2010, the three Lofts properties offer characteristically New York City-style residences. In all, the complexes comprise 460 units and about 23,000 square feet of retail space. The names derive from the distinctive platform loft floor plan created by OliverMcMillan.

The Lofts at 655 is located at 655 Sixth Ave. and features 106 units, along with architectural flourishes like floor-to-ceiling windows and a Manhattan-style lobby. Its amenity package includes a fitness center, business center and movie theater.

Located at 677 Seventh Ave., the Lofts at 677 is a Gold Nugget Merit Award-winning property that offers 157 loft-style residential units and two ground-floor dining spots.

The Lofts at 707 is located at 707 10th Avenue and offers 207 residential units with an amenity package similar to that of The Lofts at 655. Added features are a courtyard, fire pit, and outdoor seating.


Brookwood Financial Partners Buys Kearny Mesa Office Complex

13 Jun 2013, 11:28 pm

By Alex Girda, Associate Editor

Brookwood Financial Partners L.L.C.,a private equity firm based in Massachusetts, has acquired Four Points Business Park, a three-building, multi-tenant property in Kearny Mesa.

The deal marks the third San Diego-area transaction in the past 20 months for Brookwood, which previously added the Mission Valley Crossroads and Bernardo Executive Center properties to its holdings.

Located at the corner of Ruffin Road and Chesapeake Drive, the 124,712-square-foot Four Points complex was 86 percent occupied at the time of the acquisition.

The area is a favorite of professional service firms, regional sales offices and back office operations of national and regional corporate tenants. According to the buyer, the San Diego office market has seen 12 consecutive quarters of positive absorption, with the Kearny Mesa submarket also seeing constant improvement over the past several years.

Brookwood represented itself in the transaction while the seller was represented by Bob Prendergast and Lynn LaChapelle of Jones Lang LaSalle Inc. Terms of the deal were not disclosed. The new owner has enlisted CBRE Group Inc. as the property’s leasing agent.

Brookwood has acquired around 10 million square feet of office, retail, flex and R&D properties, as well as 143 hotel guest rooms, 138 condominium units, 572 apartment units and 1,360 residential lots.

Image courtesy of bfplp.com

Industrial, M-F Properties Trade in El Cajon

1 Jun 2013, 9:18 pm

By Alex Girda, Associate Editor

A 109,400-square foot industrial property located at 1111 Pioneer Way has been acquired by 1111 Pioneer Partners L.L.C. for $6 million, rentv.com reports. Located on a 4.4-acre lot just north of Fletcher Parkway, the warehouse property is currently fully leased to Vision Systems and Toro Co.

Principals of Vision Systems, which leases 25,000 square feet at the property, control the 1111 Pioneer Partners ownership entity. Newmark Grubb Knight Frank arranged the deal on behalf of the seller, Longkin Properties; Inland Pacific Commercial Properties represented the buyer.

On the residential front, Trion Properties bought a 22-unit apartment complex for $2.35 million, Trio plans to upgrade the value-add property, which had not been proactively managed by its former owners. A team from Colliers International arranged the deal.

A plan to increase the property’s value and existing rent rates will be put in place at the El Cajon asset, as company officials are confident that the investment will eventually yield a 7.5 percent cap rate. Colliers International would also be involved with the eventual sale of the property, rentv.com reports.

OliverMcMillan, Capri Capital Start 208-Unit M-F Project in East Village Arts District

16 May 2013, 10:22 pm

By Alex Girda, Associate Editor

Capri Capital Partners and OliverMcMillan have launched construction of a new residential community in San Diego’s East Village Arts District. Dubbed The Lofts at 688 13th Street, the 208-unit project will be completed in about two years. It is among the latest examples of redevelopment sparked by PETCO Park, the nine-year-old home of the San Diego Padres.

Located on three quarters of a city block, the property will offer studio, one-bedroom and two-bedroom units. Ground level units will feature floor-to-ceiling glass, and will be separated from the sidewalk by gated terraces.

Upper level apartments will feature views of the city, the complex’s landscaped courtyard or both. Ground-level units that face toward the courtyard will have private patios. The complex will incorporate two 2,660-square-foot street-level retail spaces, and the developers will widen the section of the 13th Street sidewalk adjacent to the new building.

Highlights of resident amenities at The Lofts at 688 13th Street will be a roof deck offering architectural lighting, steel and wood trellises, lounge seating, fire pits and an enclosed pet area. Extensive common areas and a media lounge, as well as a Fully Fit Gym, will round out the common-area facilities.

Rendering: OliverMcMillan/Pappageorge Haymes Partners/AVRP Studios

Beech Street Closes $9.6M Fannie Mae Loan for El Cajon Property

25 Apr 2013, 9:27 pm

By Alex Girda, Associate Editor

Beech Street Capital L.LC. has arranged $9.6 million in Fannie Mae financing for the acquisition of Bella Vista Apartments, a 150-unit affordable residential property in El Cajon.

The 10-year fixed-rate loan has 9.5 years of yield maintenance, one year of interest-only and a 30-year amortizing schedule.

Bella Vista Apartments comprises  two ten-story buildings. Resident amenities include a common swimming pool and a playground and laundry facilities. The property is convenient to metropolitan San Diego as well as Downtown El Cajon.  

Kristen Croxton and Greg Reed, Beech Street Capital executive vice presidents based in Newport Beach, originated the deal. Chris Hutchinson of Alcole Capital Group represented the buyer.

The property was the last real estate asset in California held by an unnamed institutional investor eager to divest its holdings in the area, Croxton explained. Beech Street also underwrote a welfare tax abatement to be secured by the borrower during the loan’s inaugural year.

Aimco Acquires Oceanfront M-F Complex in La Jolla for $29M

10 Apr 2013, 8:04 pm

By Alex Girda, Associate Editor

In a $29 million deal, Aimco has acquired Prospect 400, a 60-unit oceanfront property in La Jolla. The Denver-based apartment REIT was identified as the property’s new owner by CoStar.

Jim Neill, Eric Comer and Merrick Matricardi of CBRE Group Inc.’s San Diego office arranged the transaction on behalf of the Carolyn M. Holmer Irrevocable Trust, the property’s seller. Prospect 400 was developed in 1970 on a parcel where the newspaper publisher and philanthropist F.W. Kellogg once owned a summer home. The complex was most recently renovated in 2010.

Prospect 400 offers 60 units, including 29 one-bedroom apartments, 24 two-bedroom units and seven studios. The property also features 10 resident garages, while the community’s amenity package offers access to a heated pool, an ocean-view sundeck, a hydrotherapy spa and a lounge equipped with a full kitchen, media niche, billiards table and restrooms.

The building traded at around $483,000 per unit, pricing considerably higher than San Diego’s median values for 2012, as estimated by Marcus & Millichap Real Estate Investment Services Inc. Price increases in the area have been sluggish during the past four years.

Photo credit: CBRE Group Inc.

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

Inland American Lodging Grabs Andaz San Diego for $53M

21 Mar 2013, 3:19 pm

By Alex Girda, Associate Editor

Inland American Lodging Group, Inc. has added the Andaz San Diego to its portfolio in a $53 million deal. Operated by Hyatt, the 159-key property is located in the Gaslamp Quarter near the San Diego Convention Center, PETCO Park and San Diego Bay.

Seventeen of the guest rooms are suites. Amenities include 18,500 square feet of meeting space, a fitness facility, four restaurants, a heated pool and a rooftop lounge and deck.

Previously known as the Ivy Hotel, the property was rebranded Andaz San Diego in 2010. American Lodging Advisor Inc.’s president & CEO, Marcel Verbaas, commented: “This purchase aligns with our objective to acquire luxury, upper-upscale and urban upscale hotels in the top 25 lodging markets.” A 6,000-square-foot upscale Katsuya by Starck restaurant recently opened on the Andaz’ lower level.

Hyatt’s Andaz brand targets luxury boutique hotels in urban and resort locations. Each property draws its distinct design aesthetic from its surroundings.

Image courtesy of sandiego.andaz.hyatt.com


IDS, TIAA-CREF Pay $60M For Kearny Mesa Campus

9 Mar 2013, 12:13 am

By Alex Girda, Associate Editor

A joint venture of IDS Real Estate Group and TIAA-CREF recently completed the acquisition of Cabrillo Technology Center, a three-building, 285,585 square-foot corporate campus in Kearny Mesa, from Cabrillo Properties L.L.C., according to CoStar Group, which reported the price as $59.5 million.

The transaction was arranged by a team from CBRE Inc.’s San Diego office, including Louay Alsadek, Evan August, Brad Black and Andy Taylor. IDS Real Estate Group recently completed the purchase of a San Diego-area tech center.

Located on a 17-acre site on Balboa Ave., the campus consists of a building completed in 1963 and two others developed in 2000. One of the two newer buildings, 8690 Balboa Avenue, has earned LEED Silver certification as well as an Energy Star rating.

The facility is 96 percent leased to Raytheon and HDR Engineering. The facility was extensively renovated by Cabrillo Properties.

According to Matt Aminoff, vice president at IDS Real Estate’s San Diego office, “Cabrillo Technology Center was an opportunity to acquire quality infill real estate in the sought after submarket of Kearny Mesa well below replacement cost.”

Image courtesy of cbre.us

JMR Plans Q2 Start for $38M Residential Project in Santee

21 Feb 2013, 11:40 pm

By Alex Girda, Associate Editor

JMR Properties Inc. plans to launch construction of a $38 million residential project in Santee during the second quarter, the San Diego Business Journal reported. Dubbed Parc One @ Santee, the project received city approval late last year.

Located at the corner of Cuyamaca Streetand Town Center Parkway, the 172-unit community will be near the San Diego River and the Santee Trolley Town Square shopping center. The San Diego Trolley links the area with San Diego State University, Old Town and Downtown San Diego. A recently completed 55-acre community park offers baseball, soccer and football fields, tennis courts, picnic areas and playgrounds.

Parc One @ Santee will incorporate energy-efficient materials as well as an environmentally conscious design provided by O+L Architects. The community will include such upscale amenities as a swimming pool, spa, a high-end fitness facility, club room and landscaping.

Granite countertops, deluxe appliances, designer light fixtures, luxurious carpeting and ceramic tiles throughout the bath and kitchen complete the amenity package. West America Corp., the project’s contractor, is expected to complete construction by the summer of 2014.   

Rendering courtesy of olarchitects.net

Pebblebrook Pays $113M for Embassy Suites San Diego

6 Feb 2013, 5:48 pm

By Alex Girda, Associate Editor

Pebblebrook Hotel Trust has added the Embassy Suites San Diego Bay to its portfolio after paying $112.5 million for the 337-key hotel. The acquisition of the full-service, upper-upscale hotel expands Pebblebrook’s portfolio to 26 properties valued at about $2.1 billion.

As part of the deal, the REIT assumed a $66.8 million secured, non-recourse loan, with the balance of the purchase price being funded through available cash.

Embassy Suites San Diego Bay, which will be managed by HEI Hotels and Resorts, operated at 83 percent occupancy in 2012. Completed in 1988, the property underwent its most recent major renovation in 2006. A $3.5 million overhaul of the guest suites was completed last spring.

Located Downtown at the intersection of Harbor Drive and Pacific Highway, the hotel is within walking distance of such attractions as the San Diego Convention Center, the Gaslamp Quarter, Seaport Village, Petco Park and Horton Plaza Shopping Mall. Distinctive features of the property include a 12-story atrium and panoramic views of the bay and the city.

Standard guestroom amenities feature a 37- or 42-inch flat-screen TV, microwave, mini-refrigerator, coffee maker, and high-speed Wi-Fi Internet access. Hotel facilities include 5,000 square feet of meeting space, the PFC Bar & Grill, 3,411 square feet of retail space and an indoor heated swimming pool and whirlpool.

Regency Scored County’s Top 2012 Retail Buy: $81M Grocery-Anchored Center in Hillcrest

25 Jan 2013, 5:41 pm

By Alex Girda, Associate Editor

Regency Centers Corp. wrapped up 2012 with San Diego County’s biggest retail transaction of the year. Last month, the Jacksonville, Fla.-based REIT paid $81.1 million for Uptown District, a 148,638-square-foot grocery-anchored center located at 940 University Ave. in the Hillcrest neighborhood. Costar Group identified the buyer as Commercial Properties Services, which was represented by Alvin Mansour of Marcus & Millichap Real Estate Investment Services Inc.

Uptown District is anchored by Ralphs and Trader Joe’s, and its tenant roster includes national brands like Starbucks, Party City, Pier 1 Imports, Wells Fargo and Panera Bread. About 550,000 residents live within a five-mile radius. The 26-year-old property was renovated most recently in 2007, Costar reported.

Uptown District is 95 percent occupied, a rate that illustrates the strength of San Diego’s retail market. By the end of last year, vacancy in San Diego had declined to about 3 percent, well below the national rate of 9 percent, according to Marcus & Millichap.

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

Contactor Heads for Home on $11M USD Ballpark Project

9 Jan 2013, 11:09 pm

By Alex Girda, Associate Editor

An $11 million rejuvenation effort at the University of San Diego’s aging baseball park is rounding third and heading for home. Turner Construction Co. recently hit the 50% completion mark at Fowler Park, which is on track for topping out later this month and completion in February.

Taking shape at  53-year-old Cunningham Field, Fowler Park will add 1,700 seats and a new player clubhouse. Also on tap are two suites, a press box, restrooms, concessions, stadium lighting, new sod and synthetic turf. Fowler Park is home to the Toreros, one of the top 25 college baseball teams in the country.

Turner Construction is employing green building methods, including the use of local and recycled materials and low-flow plumbing fixtures, all intended to qualify the project for LEED Silver Certification.

In addition, Turner is using the EcoPort Trailer for its jobsite office. Constructed of nontoxic, formaldehyde-free plywood, the trailer uses solar and wind-generated power and composting technologies.

Rendering courtesy of usdtoreros.cstv.com

Golden Door Spa in San Marcos Commands $25M

31 Dec 2012, 7:34 pm

By Alex Girda, Associate Editor

The Golden Door Spa, a Japanese-themed luxury resort in San Marcos, has traded for $24.8 million, according to Holiday Fenoglio Fowler, which arranged the sale to an undisclosed buyer. HFF’s team was led by senior managing directors Dan Peek and Bill Stadler, and also included managing director Scott Hall and Alexandra Lalos, an analyst with the firm.

Located a 40-minute drive from downtown San Diego, the Golden Door Spa opened in 1958 and was rebuilt in 1975. Its facilities include  fitness centers, a tennis court, swimming pool, Jacuzzi, water therapy pool, Japanese bathhouse, archery range and about 20 miles of hiking trails.

Also on the grounds are a 122-acre avocado orchard and organic vegetable and fruit gardens. In addition, the new owner has also acquired the Golden Door brand, and retains the right to expand the property.

According to HFF, Golden Door Spa represents “one of the most well-known destination spa resorts and wellness brands in the world.” The property’s redevelopment and expansion opportunities, as well as its familiar brand, proved attractive to investors, explained Peek.  

Image courtesy of spafinder.org


Carey Watermark Pays $85M for Courtyard in Hotel Circle

12 Dec 2012, 8:32 pm

By Alex Girda, Associate Editor

Carey Watermark Investors, a joint venture of W.P. Carey & Co. and Watermark Partners L.L.C., has snapped up the Courtyard San Diego Mission Valley/Hotel Circle for $85 million. The deal was arranged by Jones Lang La Salle Inc. managing director John Strauss along with senior vice presidents James Stockdale and Samantha Fisher.  

Information on the Web site of the seller, Tarsadia Investments L.L.C., indicates that the company is a Newport Beach, Calif.-based firm allied with two other hospitality-related companies: T2 Development, a development and investment management firm, and Evolution Hospitality, which provides hotel management services. Carey Watermark is retaining Evolution Hospitality to manage the property.

The Courtyard San Diego Mission Valley is a 317-key facility in Hotel Circle near Downtown San Diego. It offers ready access to popular attractions like the San Diego Zoo, Old Town, SeaWorld and local beaches. “The location and physical quality, together with consistent performance and strong brand and in-place cash flow, make it a solid addition to our portfolio,” explained Michael Medzigian, Carey Watermark’s CEO. The hotel has 7,000 square feet of meeting space, a business center, fitness facilities, an outdoor pool and multiple dining options. Courtyard San Diego Mission Valley was renovated in 2008.

Carey Watermark was attracted by the hotel’s “strong brand affiliation and robust performance, coupled with San Diego’s strong and improving fundamentals,” commented Jones Lang LaSalle’s Strauss. He noted that revenue per available room in the San Diego market increased 8.8 percent year-over-year through October, and occupancy is up 5 percent compared to 2011.

Image courtesy of hotels.com

Keating Hotel Group Refinances 2 Historic Gaslamp Properties

29 Nov 2012, 4:04 pm

By Alex Girda, Associate Editor

The Keating Hotel Group has refinanced the Keating Hotel and the Mercantile Building, two neighboring properties in San Diego’s Gaslamp District. A team from Holiday Fenoglio Fowler L.P. led by Aldon Cole and Husayn Hasan placed a 10-year, 4.7 percent fixed-rate loan with Cantor Commercial Real Estate.

Located at 5th Avenue and F Street, the vintage buildings total 40,400 square feet. The 35-key Keating Hotel dates from 1890 and underwent its most recent major renovation five years ago. Pininfarina, perhaps best known for its collaboration with Ferrari, served as design consultant for that upgrade.

Dining venues include Croce’s Restaurant and Jazz Bar, Patrick’s Gaslamp Pub and a recently added lounge offering hotel access.

Located next door to the Keating Hotel, the Mercantile Building is currently home to a two-level Brick + Mortar restaurant.

Keating Hotel Group, which is headed by Edward Kaen and Chris Harris, will use the proceeds to retire existing debt and repatriate equity, HFF explained in a statement.

Image courtesy of thekeating.com

By Alex Girda, Associate Editor

HFF Secures Debt for Holland Partners’ Downtown M-F Project

16 Nov 2012, 4:59 pm

By Alex Girda, Associate Editor

Holland Partners Group Management Inc. has secured $45 million in construction and permanent financing for a 242-unit apartment complex in Downtown San Diego. Dubbed 15th and Market, the 243,000-square-foot  property will include 10,000 square feet of ground-floor retail space.

Senior managing director Tim Wright, managing director Casey Davidson and associate director Zack Holderman led the HFF team that arranged the construction loan and 10-year permanent loan. Holland Partners was represented by Thomas Warren, COO of Southern California development, and Brent Schertzer, a development associate.

According to data from Marcus & Millichap Real Estate Investment Services Inc., multi-family construction in the San Diego market is generally on an upswing. Despite a dip in permitting compared to last year, new product completions are well ahead of 2012 levels. Both permitting and completions will beat the tally for 2010 handily.

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

Image courtesy of ccdc.com







Cruzan/Monroe, Cigna Buy DiamondView Tower for $121M

5 Nov 2012, 3:20 am

By Alex Girda, Associate Editor

In a $121 million deal, Cruzan/Monroe and Cigna Investments Inc. have acquired San Diego’s DiamondView tower.  Seller Wereldhave USA was represented by CBRE Inc. The 15-story, 305,255-square-foot building is located at 350 Tenth Ave. and offers views of nearby Petco Park.

DiamondView Tower is 95 percent occupied by such tenants as the Fashion Institute of Design and Merchandising, Red Door Interactive, Cox Media, Comerica Bank, as well as CBRE’s Downtown San Diego office. CBRE will continue to handle leasing, as it has since the building’s completion in 2007.

The property includes a two-story lobby, as well as its signature 15th-story skybox, available as a hospitality penthouse unit. The building offers services such as the Fit Athletic Club, a fitness center with an outdoor pool and deck. Developed as the first component of a baseball-centric project, DiamondView Tower will now be used to capture some of the area’s potential for street-level retail.

For a more on the sale of the DiamondView building, click here.

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