Wells Fargo (Access6) LSFO
January 2, 2015

Beer Building's Big Sale

We've got the scoop on a feel-good Midmarket sale story to get the New Year started off right.

A boutique creative office and retail space at 34-38 Mason just traded for about $6M to a Taiwan-based investor operating under the entity Venice Beach Townhome, the seller tells us. It's a small 12k SF sale for the market, but the profit for seller Citrine Advisors was huge. Citrine president Jerry Smith tells us the back story.


An investment group that includes Oakland-based Citrine first bought the bank-owned asset in October 2010 as a vacant building with a checkered past, whose prior tenants included the Power Exchange and Crash Club--a night club with jacuzzis. At the time, Citrine leveraged two tenants it had in its pocket: public affairs firm Barbary Coast Consulting and beer cafe Mikkeller, above, which is situated on the ground floor of the 1907 Victorian building.

Jerry, above at our recent Oakland Construction & Development event, says Citrine assembled a group of investors that included the principals of both tenants' businesses to acquire the property for $3.2M. After investing an additional $300k in improvements and stabilizing the asset, the group was able to sell in December for a $2.5M profit (or 70% appreciation, in just over two years). The seller was repped by Tony Crossley and Erik Hanson of Colliers. There's a New Year's resolution for you: Be patient for a profit.

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Newport Beach-based Irvine Co continues to dominate a sliver of Sunnyvale, with the purchase of five office and R&D buildings totaling 113k SF in the Peery Park submarket. The portfolio was 95% leased at the time of sale. The seller was Arden Realty, repped by CBRE. Irvine's already got an existing Sunnyvale portfolio nearby, and this expansion is part of a long-term investment in Silicon Valley, according to CBRE. The buildings sit at 323 N Mathilda, 755 N Mary, 617 Palomar, 720 Palomar and 840 Del Rey and range  from 20k SF to 33k SF. Heavy-hitter neighbors include Google, Apple and LinkedIn.

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New Tower Design Revealed for Van Ness


Behold, the new tower planned for Market and Van Ness from starchitect Snohetta (SFMOMA expansion) and SCB (One Rincon), according to the S.F. Chronicle. It solves the wind problem that plagued Richard Meier's original design via sliced breaks up the 37-story residential tower. Also alleviating the swirling wind: a public plaza covered by canopies rising up to 30 feet, which would create spaces for performances from students at the nearby S.F. Conservatory of Music (flute wind: good; weather wind: bad). Developers Build Inc. and GTIS are hoping for approvals for the proposed 308-unit tower by the end of the year. Last year, SCB managing principal Chris Pemberton told us how the project at 299 Fremont is taking sustainability to new heights.

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CREW SF (Bridge2) SFO

Ted Baker's Big Debut

Ted Baker on Grant Avenue opened its closet doors following a months-long massive renovation, and we stopped by last month at a S.F. Ballet cocktail event there. The shindig was thrown by ENCORE, the young professionals event program comprised of people in PR, media, entertainment/arts and the local ad tech community. Here's S.F. Ballet Association Trustees Janice Hansen Zakin and Timothy C. Wu. The ballet is getting ready for their big Opening Night Gala at City Hall on Jan. 22, where the likes of Nancy Pelosi are known to flutter around.

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Mergers Hit Seven-Year Peak in 2014

There were 40,298 M&A deals worth almost $3.5T in 2014, the most since 2007. Cheap debt and a booming stock market both factored into the banner M&A year, which included monsters like the $66B Actavis-Allergan and $45B Time Warner-Comcast transactions. But Dealbook points out that the primary force behind the wave was an increased acceptance in boardrooms that scene-stealing acquisitions, rather than individual  moves, have become the surest way to expand companies.

The energy sector and Big Pharma led the M&A charge, accounting for 11.7% and 6% of activity. And Goldman Sachs was the most frequent financial adviser on the deals, gobbling up 29% of market share.

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Any big real estate predictions for 2015? tierney.plumb@bisnow.com