California

Gap Inc. to Close 230 Stores, Spin Off Old Navy

by Taylor Williams March 1, 2019

SAN FRANCISCO — Gap Inc. (NYSE: GPS) will close approximately 230 Gap specialty stores within the next two years, the San Francisco-based apparel chain announced in its fourth-quarter and 2018 fiscal year reports, released Thursday. Gap Inc. also revealed plans to spin off Old Navy, a brand it established in 1994, into a separate publicly traded entity, as well as to rebrand itself under a yet-to-be-determined name. In explaining their reasoning behind the split, company leaders cited a growing divergence between the customer bases, operating strategies and value-creation mechanisms of Gap and Old Navy, with the latter outperforming the former. According to The Wall Street Journal, Old Navy accounted for nearly half of Gap Inc.’s total 2018 sales of $16.6 billion. The new company will carry Gap-brand apparel in addition to clothing lines from sister brands like Athleta and Banana Republic. The two companies will trade under different ticker symbols and have separate management and leadership structures, as well as distinct financial profiles, company executives said. The company estimates that the closures of the 230 stores — roughly 20 percent of its total global store count— will result in approximately $625 million in annualized sales losses. Additionally, the company estimates …

March 1, 2019

Acquisitions California Hospitality Western

Ashford Hospitality Trust Buys 178-Key Hilton Santa Cruz/Scotts Valley for $50M

by Amy Works February 28, 2019

SANTA CRUZ, CALIF. — Ashford Hospitality Trust has acquired the Hilton Santa Cruz/Scotts Valley in Santa Cruz from The Arden Group for $50 million. Located at 6001 La Madrona Drive, Hilton Santa Cruz/Scotts Valley features 178 guest rooms, including 21 suites. The hotel, which opened in 1999, also features a full-service Stonehouse Bar & Grill, 7,900 square feet of flexible meeting space, an outdoor pool, fitness center, business center, gift shop and guest laundry facility. To fund the acquisition, the company used cash on its balance sheet and issued as consideration to the seller approximately 1.5 million Operating Partnership Units valued at $7.00 per unit, a premium of approximately 31 percent yesterday’s closing price. The company also assumed a non-recourse mortgage loan at closing with a current balance of approximately $25.3 million. The loan matures in March 2025 and has a fixed interest rate of 4.7 percent. Mark Fraioli and Melvin Chu of JLL represented the seller in transaction.

February 28, 2019

Acquisitions California Healthcare Office Western

HFF Negotiates Sale of 75,000 SF Medical Office Building in North County San Diego

by Amy Works February 28, 2019

SAN DIEGO — HFF has arranged the sale of Palomar Health Outpatient Center Phase I, a medical office building in North County San Diego. Harrison Street Real Estate Capital acquired the 75,000-square-foot property from JRMC Real Estate for an undisclosed price. The three-story, built-to-suit, Class A facility is fully leased to Palomar Health, which plans to offer high-acuity services, including radiation, oncology, express care/outpatient clinical services and a Palomar-Rady Children’s Hospital. The first phase was delivered in April 2018. Palomar Health Outpatient Center Phase I is located on the 56-acre Palomar Medical Center Escondido campus, a 288-bed hospital with the only trauma center within 20 miles. Evan Kovac, Andrew Milne and Trent Jemmett of HFF represented the seller and procured the buyer in the deal. Tim Wright and Zack Holderman of HFF’s debt advisory team were also involved in the transaction.

February 28, 2019

Acquisitions California Mixed-Use Multifamily Restaurant Retail Western

Colliers Brokers $9M Sale of Two Mixed-Use Properties in La Jolla, California

by Amy Works February 28, 2019

LA JOLLA, CALIF. — Colliers International San Diego Region has arranged the sale of two adjacent mixed-use properties in downtown La Jolla. Located at 7527-7535 and 7545-7553 Girard Ave., the assets sold for a combined total of $9 million. Bill Shrader of Colliers International San Diego Region’s Urban Property Team represented the seller of both properties, Rancho Girard LLC. Shrader also represented the buyer, YDNL LLC, of 7527-7535 Girard Ave., while Michael McNally of Pacific Commercial Management represented the undisclosed buyer of 7545-7553 Girard Ave. The 7545-7553 Girard Ave. property is a 7,649-square-foot restaurant and retail building occupied by Harry’s Coffee Shop and Everett Stunz. Situated on a 9,749-square-foot lot, the building at 7527-7535 Girard Ave. features two residential apartments and long-term retail tenants, including Dewhurst & Associates and Salon Spruce, among others.

February 28, 2019

California Development Industrial Self-Storage Western

Westport Properties Buys Land Parcel in Los Angeles to Develop 152,000 SF Self-Storage Facility

by Amy Works February 28, 2019

LOS ANGELES — Irvine, Calif.-based Westport Properties has acquired a 2.2-acre land parcel, located at 4800-4830 Valley Blvd. in Los Angeles’ Eastside submarket, for $5.4 million. The company plans to develop a three-story, 152,000-square-foot US Storage Centers self-storage facility on the site. Ben Spinner of DAUM Commercial Real Estate Services represented the buyer, while James Vu and Michael Collins, also of DAUM, represented the private seller in the deal. Westport Properties recently completed a self-storage facility at 2500 W. Hellman Ave. in Alhambra, Calif., and is currently underway on a development at 1901 W. El Segundo Blvd. in Compton, Calif.

February 28, 2019

California Features Multifamily Walker & Dunlop Western Western Feature Archive

Expect Multifamily Debt Market to Grow Overall in 2019, Says Walker & Dunlop’s Jeff Burns

by Taylor Williams February 28, 2019

SAN DIEGO — While agency volume may decrease slightly in 2019 due to tougher energy conservation standards in green lending programs offered by Fannie Mae and Freddie Mac, the multifamily debt market overall is expected to grow this year, according to a veteran mortgage banker. Jeff Burns, managing director at Walker & Dunlop’s Walnut Creek, Calif., office, spoke to REBusinessOnline at the MBA 2019 Commercial Real Estate Finance/Multifamily Housing Convention & Expo. The event, held at the Manchester Grand Hyatt San Diego, took place Feb. 10-13. Although the 10-year Treasury yield is down about 50 basis points since reaching 3.2 percent in early November, most economists expect long-term rates to rise in 2019. (Investor worries over trade conflicts, a volatile equities market and falling oil prices led to a precipitous drop in the yield on the benchmark Treasury note.) Burns, who is responsible for new loan origination in California and the western United States, discussed trends in agency lending as well as the state of the multifamily market. What follows are his edited responses: Rebusinessonline.com: What trends are you seeing in agency financing for the multifamily sector in the western region? Jeff Burns: Fannie Mae and Freddie Mac continue to …

February 28, 2019

California Development Multifamily Student Housing Western

UC Davis, University Student Living Break Ground on 3,300-Bed Residential Complex

by Amy Works February 27, 2019

DAVIS, CALIF. — A public-private partnership between the University of California, Davis and University Student Living has broken ground on a student housing complex that will add 3,300 beds to the university’s West Village neighborhood. The first 1,000 beds of the project are expected for completion in fall 2020. The joint venture recently announced the closing of $575 million in financing, which comes from the proceeds of a tax-exempt bond sale. The new complex, set on 34 acres, will comprise nine four-story apartment buildings along with indoor and outdoor community space and recreational fields. A 10,000-square-foot community building will house a fitness center, multipurpose room and student support services. The development team includes general contractor CBG Building Co. and architect Stantec. When complete, the new apartment communities at West Village will be owned by the non-profit Collegiate Housing Foundation, which will hold the ground lease from the University of California. University Student Living is the student housing arm of The Michaels Organization, a residential real estate firm with full-service capabilities in development, property management, finance and construction.

February 27, 2019

California Development Industrial Western

Dermody Properties Buys 19-Acre Inland Empire Site to Develop 411,330 SF Distribution Facility

by Amy Works February 27, 2019

RIALTO, CALIF. — Dermody Properties has acquired a 19-acre site in Rialto for the development of LogistiCenter at Rialto I. Terms of the transaction were not released. The 411,330-square-foot distribution facility will feature 36-foot clear heights, a 185-foot concrete truck court, 49 dock-high doors, 77 truck trailer spots and 245 auto parking stalls. Dermody Properties selected HPA as the architect and Fullmer Construction as the general contractor for the project. The company plans to begin construction soon on the property, with delivery slated for December. The facility is situated within Renaissance Rialto Business Park, which is home to Amazon, Target, Under Armour, Ozburn-Hessey Logistics, Niagara Bottling, Medlin Industries, Monster Energy, Distribution Alternatives and Lifetime Brands. Darla Longo and Barbara Perrier of CBRE represented all parties in the sale. Dan De La Paz, David Consani and Jim Koenig, also of CBRE, will be the leasing brokers for the project.

February 27, 2019

Acquisitions California Retail Western

Progressive Real Estate Brokers $4.6M Sale of Gas Station, Convenience Store in California

by Amy Works February 27, 2019

HESPERIA, CALIF. — Progressive Real Estate Partners has directed the sale of a free-standing gas station and convenience store, located at 16815 Main St. in Hesperia. An Orange County, Calif.-based private investor sold the property to a Nevada-based private investor for $4.6 million. Encompassing a 1-acre site, the transaction included an eight-pump ARCO Gas Station and a 2,500-square-foot AM/PM Convenience Store. The building was built in the late 1980s. Victor Buendia of Progressive Real Estate Partners represented the seller and buyer in the deal.

February 27, 2019

Acquisitions California Multifamily Retail Western

Levin Johnston Brokers Two Property Sales in the California’s East Bay Totaling $23.4M

by Amy Works February 26, 2019

HAYWARD AND SAN LEANDRO, CALIF. — Levin Johnston of Marcus & Millichap has directed two property sales, totaling $23.4 million, in the East Bay area of San Francisco. In the first deal, Levin Johnston, Adam Levin and Eymon Binesh of Marcus & Millichap brokered the acquisition of Stratford Village Center, located at 1641-1645 Industrial Parkway West in Hayward. A private buyer acquired the property for $12.9 million. Originally constructed in 2003 and 2004, Stratford Village Center features 40,852 square feet of retail space. At the time of sale, the property was 100 percent occupied by a variety of tenants, including Starbucks Coffee, Subway, Fremont Bank, Straw Hat Pizza, DaVita Inc., Select Staffing, CosmoProf and Manheim Inc. In the second transaction, Levin and Johnston represented the buyer and seller, both local apartment owners, in a $10.5 million multifamily transaction. Located at 15977 Maubert Ave. in San Leandro, The Maubert Apartments is a garden-style apartment community comprising four buildings offering a total of 34 apartments in a mix of two-bedroom/two-bath and one-bedroom/one-bath flats. On-site amenities include a gated and secured entryway, private balconies, assigned covered parking and on-site laundry.

February 26, 2019

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