What We Are Reading This Week

Boston Properties Finalizes Acquisition of 4th & Harrison Site in San Francisco for $140MM

Following the approval of its massive Central SoMa development project in December of last year, Boston-based Boston Properties has closed on the sale of the parcel located at 4th and Harrison for $140.1 million, according to the publicly-traded real estate investment trust’s 2020 second-quarter earnings report. The potential development of this project would amount to a total of 804,000 square feet, which is slightly lower than the previously approved approximately 820,000 square feet. It is not certain at this time when the development project would be started and completed. When the city’s approval was granted, the company stated that construction could start in the second half of this year, however this was the plan well before the start of COVID-19. Now, the development has been paused until the public REIT can evaluate the effects of the pandemic on the industry given the current market uncertainty. For now, this project will not be started on a speculative basis.

The vast majority of the space of this project will be dedicated to office space. This part of the development will total around 770,000 square feet. The initial amount allocated to Boston Properties as part of San Francisco’s Prop M annual office development limit was 505,000 square feet, however, the city allowed additional space after it saw the full extent of the company’s development plans. “Boston Properties has, once again, outdone themselves in creating a unique development project that raises the bar in innovation and sustainability and provides direct benefit to the surrounding community,” said Joel Koppel, the vice president of the City of San Francisco Planning Commission, at the time in a statement. The other parts of the project are 36,000 square feet of retail space and 16,700 square feet of public open space.

$850 million: Busy developer deepens downtown San Jose investments

A busy developer has dramatically increased its spending plans for projects in downtown San Jose, saying it’s confident in the potential for the city’s downtown despite the coronavirus. Urban Catalyst is now planning to invest $850 million on projects in downtown San Jose, compared with the $700 million the development firm previously envisioned. The upswing in project investments represents a huge increase — 21 percent more — over the amount the real estate company had been eyeing just a few months ago in the urban heart of the Bay Area’s largest city.

Urban Catalyst has decided to greatly expand the scope of housing it is planning to develop a short distance from a transit village called Downtown West that Google is planning near the Diridon train station, a move that also has pushed higher the developer’s estimates on what it expects to spend on an array of projects.

New owner doubles down on old downtown Reno JCPenney building with major renovation

Even as the COVID-19 pandemic puts several projects on pause while many folks hunker down and work from home, the renovation of 100 N. Sierra St. continues to move forward with an eye on 2020. Inside the building’s second floor, a masked David Woods is like a kid in a candy store. The first vice president of office properties for commercial real estate firm CBRE rattles off a list of upcoming improvements to the building, which has been stripped down to bare concrete but should be fully remodeled this year.

The changes represent a major financial commitment to a property that originally opened as a JCPenney store more than four decades ago but has now seen better days. The turning point occurred around 10 months ago when new ownership came in, according to Woods. San Diego-based investment company Fenway Capital Advisors quickly decided to give the building what it needed most: capital. 

Revitalization of Downtown San Jose Continues with JP DiNapoli Companies’ Submittal for 781,000 SQFT Almaden Boulevard Tower

Almaden Boulevard is fast becoming a key hotspot for office projects in downtown San Jose, as developers’ plans will change the face of one of the city’s important thoroughfares in the coming years. Looking to make a statement amidst the wave of current development is J.P. DiNapoli Companies, who recently submitted its plans for Almaden Boulevard Tower, a 20-story, 781,000 square foot office tower. Designed by global architecture firm Gensler, the project team intends for the development to make a statement.

Located at 50 Almaden Boulevard, J.P. DiNapoli Companies purchased the project site for $35.65 million at the end of 2019 from Pacific Bell, affiliated with AT&T. Over the past several months, J.P. DiNapoli Cos. has been working with Gensler to refine the building’s design and produce a striking and welcome addition to the neighborhood. The exterior of the building will feature a bronze fa?ade clad in large, triangular louver panels, allowing the fa?ade design to filter daylight, preventing glare and shade. Six terraces for recreation, collaboration, and with views of the San Francisco Bay and the Mount Hamilton Mountain Range are also included in the project plans. The building is targeting LEED Gold and upon completion will be the second fully-electric building in San Jose.

Prometheus Seals Several Deals for Apartments, Retail, Totaling $77.2MM

One of the largest private owners of multifamily properties in the Bay Area has expanded its portfolio in Sunnyvale, a key market in the region. In several transactions that closed at the end of July, Prometheus purchased the St. Francis Arms Apartments, the Willow Pond Apartments, and the Amber Circle Shopping Plaza for a combined $77.2 million. The previous owner of the properties was a private trust, affiliated with the Bellomo family, who has owned the properties for more than two decades.

The St. Francis Arms Apartments, located at 739 E. El Camino Real, features one- and two-bedroom apartments with open terraces. Community amenities include a fitness center, swimming pool, koi pond and garden space. Pricing for units starts at $1,850 per month. Prometheus also acquired the Willow Pond Apartments, at 825 Maria Lane. The two-story complex, which totals 52 units, was originally constructed in 1975. The complex is not yet listed on Prometheus’ website, but according to Apartments.com, units vary in size from 350 square foot studios to 1,770 square foot three-bedroom units. Pricing also varies between about $1,600 and $4,000 per month. A clubhouse, along with a fitness center, spa and furnished units, are some of the complex’s amenities. Prometheus also purchased the Amber Circle Shopping Plaza. The plaza is located at 717 E. El Camino Real and is a strip retail center. Public documents indicate that the property’s two buildings were both constructed in 1985; together, they total 35,840 square feet.