StarPoint Embarks on $100 Mil San Diego Apartment Investment Program

Now that its been a couple of years since the once-insatiable demand for apartment properties in San Diego by condo converters has pretty much disappeared, investment activity and pricing for apartments has settled down noticeably. One big SoCal apartment investment firm that has taken note of this is Beverly Hills-based StarPoint Properties, which just announced a $100 mil acquisition program for 2008 that targets assets in San Diego and the surrounding areas.

StarPoint just closed on the program’s first purchase, a circa-1924 apartment building located in the city’s Hillcrest area. The 58-unit complex, located at 1571 University Ave, sold for roughly $6.2 mil ($106.9k/unit).

“Until recently, we were priced out of the San Diego market because of condo conversions,” said Paul Daneshrad, CEO/president of StarPoint Properties. “Now, the market is opening up, allowing us to buy at apartment pricing. Given the strength of the market’s overall fundamentals, such as its future growth and the limited supply, it is a perfect time for us to re-enter the market.”

The Beverly Hills-based company plans to renovate the complex, known as “Casa Grande,” yet maintain features such as the original wood flooring and much of the original architectural detailing. The complex, which is comprised of studio and one-bedroom apartments, also includes two 1700-square-foot penthouse apartments with 17-foot ceilings that highlight sweeping views of the area.

“This complex has been a part of the Hillcrest community almost as long as the community has existed,” said Daneshrad. “While it was originally built as a hotel, it was converted to apartments about 50 years ago. Today, it is a prime location, within walking distance of all the trendy shops and restaurants. Our goal is to participate in the area’s urban rejuvenation and make this a luxuriously stylish building for not only the residents, but the community as well.”

Current plans include upgrading the interiors of the apartments, as well as enhancing the garden-style common areas and spacious lobby entrance. In addition, new features, such as a fitness center and additional storage areas, are planned.

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source: rentv.com

Sonnenblick-Eichner Arranges DeLuxe Deal in Portland

Sonnenblick-Eichner Company, the firm led by David Sonnenblick and Elliot Eichner, arranged $24 mil of first mortgage financing for the Hotel deLuxe, a stylish, boutique hotel located in Portland, Oregon. The eight-story, 130-room facility recently underwent a $10 mil renovation and re-opened its doors in May 2006. The hotel, with its retro 1960s “Hollywood” theme, is the creation of Portland-based Provenance Hotels and was recently elected to the Condé Nast Travel Magazine’s Top 100 Hotels in the U.S.


The financing consisted of a 10-year fixed-rate loan priced at 200 bps over the 10-year treasury. The loan is interest-only for the initial two years of the term and also includes an earn-out provision allowing the borrower to capitalize on increasing cash flow as the property reaches stabilization.

Eichner commented on the deal, “Despite the turmoil and volatility in the capital markets, we were successful in structuring a loan providing for maximum proceeds, plus an earn-out component. The interest rate was in the low 6 percent range, and the interest-only component provides greater cash flow as the property is ramping up toward stabilization.”

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source: rentv.com

Hines Buys Vacant Office Building in Redwood Shores Area

A vacant 154.6k sf office property south of San Francisco in the Redwood Shores submarket recently traded hands in a transaction valued at around $50 mil ($323/sf). The asset, which is currently the largest available block of contiguous office space in San Mateo County, was acquired by Hines U.S. Office Value Added Fund II L.P., a Houston-based investment group.

The free-standing, three-story building is located at 600 Clipper Dr, east of the 101 Fwy in Belmont, about five miles south of Foster City and just minutes from San Francisco International Airport. It was sold by Palo Alto-based Broadreach Capital Partners, which acquired the asset in September of 2005.

The contemporary-style development was constructed in two phases, with the initial 120k sf space built in 1995, followed by a 40k sf phase that was added in 2000. The building features floor-to-ceiling windows, large 51k sf floorplates and 471 surface parking spaces.

Commenting on Hines’ plans, Dave Congdon, Senior Vice President and HVAF II Fund Manager, said “We consider this a quality, well-located asset where Hines can add value through leasing.”

Edward Suharski of Grubb & Ellis handled negotiations for Broadreach. Hines represented itself in the deal and will manage the property. Cornish & Carey will handle leasing for the new ownership.

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source: rentv.com

TDC Ringing in the New Year with $150 Mil of 4th Quarter Deals

It’s been a very active month and a half for Torrance-based Transpacific Development Company, as the company completed the acquisition and disposition during this time of several properties containing a total of about 922k sf. The transactions, involving properties in three states, are worth a combined $150 mil.

“This has been an active quarter for us,” said Thomas Irish, President of TDC. “The investment and capital markets have been shifting very rapidly, providing long-term value investors like TDC the opportunity to acquire some high-quality properties. Our ability to make decisions quickly and to use our own funds makes us attractive to sellers who want certainty of closing. We are not dependent upon the tumultuous lending market to fund our acquisitions.”



TDC’s recent transactions include:

• The purchase of 217 Wrangler Drive, a 115k sf, single-tenant flex building in Coppell, Texas.
• The acquisition of the 92k sf Art Institute of Phoenix building, located at 2233 W. Dunlap Ave in Phoenix, Arizona.
• The acquisition of 500 Airline Dr in Coppell, Texas, a 409k sf distribution building.
• The acquisition of 510 Airline Dr, also in Coppell, which is a 53k sf office building.
• The disposition of two office buildings totaling 253k sf and a 5-level parking structure located at 711 Kapiolani Blvd in Honolulu, Hawaii.

Irish noted that the four acquisitions were purchased on an all-cash basis. “We are continuing our pursuit of Class A properties in top-25 office and distribution markets,” said Irish. “The Dallas/Fort Worth and Phoenix markets are showing tremendous growth, and fit well with our strategy. We are actively working to expand our portfolio, and believe there will be some outstanding investment opportunities in the new year.”

Founded in 1954 by Shurl Curci, TDC is a full service real estate development and investment firm has developed nearly 10 msf of office, industrial and retail properties throughout the western United States. The firm invests and develops for its own account, without outside partners or investors. TDC entities currently own more than 11 msf of property in six states.

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source: rentv.com

Construction Underway on Valencia’s First LEED-Certified Office Project

Construction on an exciting new office project in the master-planned Valencia area has reached the mid-point, with completion scheduled for mid-April 2008. Called Summit Oaks, the $25 mil building is being developed by Aliso Viejo-based Parker Properties and will contain 144k sf of Class A space over five floors.

Summit Oaks will feature a sustainable design and is expected to receive a silver LEED rating, making it the only LEED office building in that market. Located at 28515 Westinghouse Place in Santa Clarita, the property offers easy access to I-5 and is just 30 miles north of downtown Los Angeles.

According to Kevin McKenzie, President of Parker Properties, the project was designed “to provide its tenants with a highly functional, attractive and environmentally conscious work environment within the amenity-rich community of Valencia.” McKenzie also noted that Summit Oaks presents companies with the opportunity to elevate their corporate identity in a first-class property that is also the area’s most visible office building from Interstate 5.

Summit Oaks is situated on 4.29 acres with interiors that feature flexible, 28k sf plates, first-class common areas, an elegantly finished ground floor lobby with two-story atrium, plentiful light and natural finishes. The outdoor environment includes outdoor “people places,” lush, mature landscaping, water features and a two-level parking structure which offers covered parking.

To achieve its silver LEED certification, Summit Oaks will incorporate numerous sustainable features, including but not limited to: certified cool roofing system; on-site storm water drainage filtration system to manage storm water runoff; water efficient, drought tolerant landscaping; eco-friendly HVAC and refrigerant equipment; recycled structural steel used in building structure; indoor environmental quality strategies, such as carbon dioxide monitoring systems, the use of low emitting materials, exhaust ventilation at chemical storage closets, and beyond standard air handler filters; and green housekeeping and site maintenance programs will be implemented by Parker Properties to assure future low impact environmental cleaning policies. Additionally, Parker Properties will provide tenants with tenant improvement design and construction guidelines to assist in the adoption of green tenant improvements.

Summit Oaks is adjacent to Courtyard by Marriott and Embassy Suites and is just minutes from a large amount of retail, dining, entertainment and recreation amenities including Valencia Town Center Regional Mall, Valencia Marketplace, Valencia Crossroads, four golf clubs, community parks and The Paseo Club - a tennis, swim and fitness facility – to name a few.

Companies that have already relocated or expanded at Valencia Gateway include Warner Bros, Princess Cruises, Kaiser Permanente, KPMG Future Media, ITT, Pharmavite, Qiagen Inc, Remo Inc, Harte-Hanks, PDI Enterprises, Attraction Services, TA Manufacturing, Chocolates a la Carte, Advanced Bionics, The Packard Humanities/UCLA Television and Film Production Center, Specialty Labs Inc, Merrill Lynch, Cinetech, Second Sight, Westwood One, Explorer Insurance, Northwestern Mutual and Specialty Laboratories, among others.

Doug Marlow and David Solomon of CB Richard Ellis are responsible for leasing Summit Oaks. Snyder Langston is the general contractor and Ware & Malcomb is the architect for Summit Oaks.

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source: rentv.com