LOS GATOS, CALIF. — The Grove, a 485,000-square-foot office campus in Los Gatos that will soon to be home to Netflix’s world headquarters, has received a $100-million construction loan. The Class A campus will be located on Winchester Boulevard, alongside Highway 85, in Silicon Valley. The first phase will contain 242,000 square feet in two office buildings that are pre-leased to Netflix. Construction is already underway, with an anticipated completion date of next May. John Nelson of CBRE’s San Francisco office arranged the financing on behalf of the borrower/developer, a joint venture between Sand Hill Property Company and the Carlyle Group. It was provided by a syndicate of lenders headed up by SunTrust Robinson Humphrey. SunTrust Bank also acted as administrative agent. The interest rate was a variable, LIBOR-based rate.
MILPITAS, CALIF. — Tasman Technology Park, a 610,000-square-foot office and R&D campus in Milpitas, has received an $84-million acquisition loan. The institutional-quality property is located at 1371 McCarthy Blvd., just north of San Jose. The 14-building campus is situated in the center of Silicon Valley’s “Innovation Triangle,” which is home to more than 7,000 technology companies. These include Array Networks, Fire Eye Inc., KLA Tencor, Lifescan, SanDisk and Touchstone Semiconductor. The seven-year, non-recourse, fixed-rate loan was arranged by Brad Zampa, Michael Walker and Megan Woodring of CBRE’s San Francisco office on behalf of the borrower, an entity owned by Lionstone Investments and Orchard Partners. The partial interest-only financing features a rate in the low 4 percent range. It was provided by an East Coast-based life insurance company. The seller, Deutsche Asset & Wealth Management, was represented by Russell Ingrum, Joe Moriarty, Sean Sullivan and Tyler Meyerdirk of CBRE Capital Markets’ Institutional Properties team.
CONCORD, CALIF. – The 48-unit Diablo Villas Apartments in Concord has sold to WaveCrest Capital Management for $8.8 million. The community is located at 4265 Clayton Road. It is fully occupied. The community will be rebranded as CityPlace Apartments. It was originally built in 1964. The seller, a local Bay Area lender affiliate, foreclosed on the property in late 2010. Acquisition financing was provided by American West Bank. WaveCrest was represented by Patrick Nash and Chris Sparacino of Bay Apartment Advisors.
LOS ANGELES – An 8,900-square-foot industrial building in Los Angeles has sold to E.R. Mehr-Grand LLC for $3 million. The building is located at 1314-1320 S. Grand Ave. E.R. Mehr-Grand was represented by William O. Morrison and Thomas M. Williams of Heger Industrial. The seller, South Grand LLC, was represented by Mollie Dietsch, Jim Halferty and Mike Smith of Lee & Associates-Commerce.
CORONA, CALIF. – A 31,068-square-foot industrial building in Corona has sold to CFA LLC for $3.7 million. The building is located at 369 Meyer Circle. The property was purchased by the existing tenant, which has occupied the building since 2010. CFA was represented by Larry Null of Lee & Associates. The seller, Maddie LLC, was represented by Scott Smith of the same firm.
San Francisco is a veritable boom town that has already surpassed the market roar of 1999. It can even conceivably be compared to 1849, when gold was discovered 100 miles east. In fact, this year is so utterly off the charts that most of us in the commercial real estate industry have never seen an upcycle like this in our entire careers. Witness the fact that through the first three quarters of 2014, San Francisco’s gross office absorption reached 7.6 million square feet. Net absorption in this same period was 2.4 million square feet. This compares with 1999, the record year, when gross absorption was 7.4 million square feet – and that was for the entire year! It is quite possible we’ll hit 10 million square feet of gross absorption by the time 2014 closes out. Incidentally, net absorption for 1999 was “only” 526,000 square feet. Not surprisingly, three out of the four biggest leases in the third quarter were completed by tech companies. The tech frenzy in San Francisco has been well documented. Most of the Silicon Valley companies want, or need, to have a presence in the city. The trend is employment-driven. Young techies don’t want to commute …
LOS ANGELES – Selective Real Estate Investments has acquired an 82,660-square-foot industrial complex in North Hollywood for an undisclosed sum. The three-building complex is located at 11605 & 11611 Hart Street. The seller, Bobrick Washroom Equipment, has occupied the space since 1965. Selective Real Estate was represented by David Young and Chad Gahr of NAI Capital’s Encino office.
MANHATTAN BEACH, CALIF. – True Religion Apparel has leased a 72,246-square-foot office building in Manhattan Beach. The new space is located at 1888 Rosecrans Ave. The jeans and apparel company will be relocating its corporate headquarters from nearby Vernon. The landlord is Continental Development Corporation. The transaction was executed by John Minervini, Erik Larson, Robin Dodson, Chris Tolles, Michael DeSantis and John Doyle of Cushman & Wakefield.
SAN FRANCISCO – A 600,000-square-foot office building in San Francisco has received a $150-million loan. The 48-story property is located at 345 California Center in the city’s Financial District. The loan was secured by JLL’s Keith Largay, John Manning, Alex Witt and Fiorentina Malko. It was provided to an affiliated entity of Metropolis Investment Holdings by Cornerstone Advisers, which acted on behalf of MassMutual.
BEVERLY HILLS, CALIF. – Jenel Management Corp. has acquired a 26,500-square-foot office building in Beverly Hills for $47.2 million. The building is located at 461-469 N. Beverly Drive, within the Beverly Hills Triangle. The former Bank of America building was fully redesigned in 1995 by Richard Meir and the Paley Center for Media, which previously was known as the Museum of Television and Radio. It is situated on the southwest corner of North Beverly Drive and Little Santa Monica. Jenel Management was represented by John Bertram of Savills Studley. The seller in this all-cash transaction was composed of several trusts representing several generations of the original business partners who had initially purchased this property in the 1920s from Burton Green. At the time, the space served as the buyers’ lumber company headquarters. The seller was represented by Chris Holland and Patrick Sheekey of Coldwell Banker Commercial WESTMAC.