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 next year.
Every week, our Real Estate Editor, Richard Spaulding, selects a commercial real estate sale or lease transaction that he feels has particular merit in its time and place. It may be because of its size in terms of dollars, it may be the first of its type in a long time, it may have been a difficult deal to make for any number of reasons -- but it is always of interest to the real estate and general business communities.
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.
The property consists of three buildings of five and six stories totaling 278,787 square feet, plus a parking structure. The eight-acre property can also accommodate approximately 168,000 additional square feet of office space.
The approximately 233,000-square-foot Torbati Building, at 625 Broadway in downtown San Diego, sold for $52.5 million. The building is to be converted into an upscale residential project with more than 220 residential units.
The 128,852-square-foot Creekside Plaza community shopping center is anchored by a Stater Bros. market and a 10-screen Digiplex theater. The center is 99 percent occupied, with tenants including Subway, Starbucks, Gamestop, Chipotle and FedEx.
The 51,637-square-foot Bed Bath & Beyond and the 44,477-square-foot Sports Authority stores at 390 and 394 East H Street in Terra Nova Plaza occupy two buildings that were once occupied by Home Depot.
The new 15,317-square-foot Palomar Place shopping center at 961 and 965 Palomar Airport Road in Carlsbad has a prime coastal location near Legoland, the Carlsbad Flower Fields, Carlsbad Premium Outlets and Costco.
Sperry Van Ness International is a national commercial real estate management group with more than 45 million square feet of real estate under management. Sperry Van Ness | Finest City Commercial (SVN|FCC) is the local franchise servicing the management of apartments, retail centers, industrial, office, receiverships and oversight asset management, as well as commercial sales and leasing of all product types.
Douglas Wilson Companies has recently closed on a major urban site in Tempe, Ariz., that will be home to a $200 million cutting-edge mixed-use development.
The Greater San Diego Association of Realtors handed out its Awards of Excellence on Saturday evening during its annual installation dinner and dance.
Office leasing overall in San Diego County continued to improve last year, although there are soft spots, according to reports by JLL, Newmark Grubb Knight Frank, Colliers International and CoStar Group Inc.
North County's industrial vacancy rate may go below 5 percent this year, Otay Mesa is rebounding and it still makes more sense to buy rather than to build.