Join The Daily Transcript in recognizing the 2014 commercial real estate deals of the year. We’ll look at top commercial leases and sales over the past year and see what’s in store for 2015.
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Employment growth and a steady flow of people moving to San Diego continues into 2015 as leading industries add more jobs. This year, 37,000 new jobs are expected in the metro, and for the sixth year in a row, tourism will rise. Biotech firms and the military will also contribute to the area’s job growth. In South San Diego, the ongoing expansion of the San Ysidro border crossing is expected to support day trips from Mexico, creating a number of new positions near the border.
The $256.5 million sale of the massive San Diego Tech Center in Sorrento Mesa was by far the largest transaction of 2014.
Starwood Capital Group entity paid $294.5 million for about 1 million square feet in a dozen office and industrial buildings in Sorrento Mesa and Carmel Mountain Ranch. The assets were sold by a Los Angeles-based Kilroy Realty Corp. partnership (Kilroy Realty L.P) to a Starwood partnership known as SOF-IX KR Holdings L.P. in a two-phase deal that substantially reduces Kilroy's presence in San Diego.
Involved in the transaction was the 9-building, 655,643-square-foot San Diego Tech Center on a total of 38 acres in Sorrento Mesa for $256.5 million. The land is entitled to an additional 1.2 million square feet of office/industrial development, 350,000 square feet of which is fully entitled and ready to build. According to Lynn LaChapelle, managing director and capital markets specialist with JLL, the property was originally acquired by the seller, Beacon Capital Partners, as part of an overall portfolio.
The five-story AT&T Data Center, a 499,402-square-foot facility at 7337 Trade St. in the Miramar submarket of San Diego, was constructed in 1983 on a 16.86-acre lot.
The buyer was GDCI Proctor Valley LP, a unit of Carmel Valley-based GDC Communities, which is an affiliate of Genstar Development Co. The seller was a series of partnerships controlled by RMJB Inc., headed by Ronald Therrien, of Tustin. GDC is teamed with Bonita-based Jackson Pendo Partners, which will actually develop the homes.
The land will accommodate 1,007 single-family lots, and construction on the homes is expected to start within the next two years.
The property consists of five vacant finished lots ranging from 4.62 to 8.18 acres on Scripps Ranch Boulevard, Meanley Drive and Hoyt Park Drive. The lots are situated just blocks from Interstate 15 and offer views ranging from the coastline to the backcountry. Walking trails surround the property and shopping and entertainment venues are close by.
The Sunterra Apartment Homes is a 240-unit garden-style apartment complex in the Tri-City area at Oceanside. Built in 1974 on 14.2 acres, the complex includes 13 residential buildings totaling 218,944 square feet of net rentable area. The apartments feature private patios or balconies. Every unit includes a garage, which was an attractive amenity to bidders on the property because of the potential for higher rental rates, according to Marcus & Millichap’s Christopher Zorbas.
For sale were 124 rental homes in the 216-unit Central Park La Mesa condominium community. It was built in 1989 and partially renovated in 2006. The seller had purchased the property in 2010.
The 102-unit Alta Vista apartment complex consists of 76 two-bedroom/two-bath units, 24 one-bedroom units and two three-bedroom/three bath units, with a total square footage of 97,728. Unit features include terraces and balconies. The property also has a pool, business center and fitness club.
Two downtown San Diego office towers, the 560,329-square-foot building at 701 B Street and the 187,304-square-foot building at 707 Broadway were involved in the transaction.
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Some of San Diego County's office and industrial markets are tight enough to justify speculative construction, while developers may never be able to build enough apartments here to satisfy the demand.
Equity and debt seem to be flowing freely from every pore to commercial real estate, and the main problem appears to be finding properties in which to invest.
The status of San Diego County's commercial real estate market was the topic of a roundtable discussion held at The Daily Transcript offices earlier this month.
The coming year for commercial real estate in San Diego holds promise and perils.
The recent trend in San Diego County showing movement toward Class B office space and rebounding rents looks to have some stamina, several local real estate executives say.
Feb. 19, 2014 -- George Chamberlin sits down with Corky Mizer, owner and CEO of Corky's Pest Control, to talk about how Mizer got his start in the industry and the importance of hiring the right people.
Join The Daily Transcript in recognizing the 2014 commercial real estate deals of the year.