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

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

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

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

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

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

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

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

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

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

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 15^th-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.

School District Sells Surplus Sites; Retail Center Fetches $27M

By Alex Girda, Associate Editor

The San Diego Unified School District has approved the sale of two unused school sites but is holding onto a third in hopes of attracting a developer, KPBS.org reported.

The district received bids of $16.5 million each for Barnard Elementary School in Ocean Beach and a similar bid for an elementary school site in Mission Beach. A third property, an undeveloped parcel in Paradise Hills, attracted a $3.1 million bid.

However, two board members blocked the sale of the Mission Beach site on the ground that finding a development partner would be a better option for the district than selling the property. The board ordered district staff to find an alternative site to sell from among seven designated for disposition.

In other transaction news, an affiliate of Kleege Enterprises paid $27.3 million for Clairemont Village, a 127,175-square-foot neighborhood center. Pacific Clairemont Holdings I, an affiliate of Essel Manager Inc., sold its property at a slight discount from the $29 million price that it paid for the property in 2005, the San Diego Business Journal reported.

Located at 3005-3033 Clairemont Drive and anchored by Keil’s Food Stores, the center was constructed in 1978 and is 85 percent leased to a tenant roster that also includes HomeTown Buffet, Time Warner Cable, Carls Jr. and McDonalds. Flocke and Avoyer Commercial Real Estate and CBRE Group Inc. represented Pacific Clairemont Holdings; Kleege Enterprises represented itself.

Image courtesy of sandi.net