Heard at BMAC West; The Deal Sheet
Last week in LA, two San Diego residential pros were featured at BMAC West, Bisnow's annual West Coast multifamily conference. (Here's coverage from the event: Part 1 and Part 2.) Despite conventional wisdom, perhaps it's time to stop thinking of California as a north-south state, we learned. (As long as we don't need a passport.)
Seth Grossman, managing director of Meridian Capital Group's Carlsbad office, says the state is actually east and west. There's no shortage of lenders for deals that are close to the water, he notes, but you get more conservative as you move east. (They're prejudiced against Nevada, who can blame them?) Speaking on a panel about funding new development, Seth says he personally enjoys doing deals in tougher markets because he feels that he's adding more value. In urban areas, you've got 100 lenders lined up. Do a deal in Podunk, Iowa, and you end up looking like a hero.
PayLease director of account management Matt Amoia moderated a panel on multifamily design and innovation, including the trend toward smaller units and automated package management. Regarding the amenities that developers still need to include in their buildings, the consensus is that balconies, clubhouses, and dog park/dog washes continue to be important to apartment dwellers. Matt points to Downtown San Diego's high rate of dogs per capita, especially large breeds like Great Danes and Bullmastiffs. (Which means there's also a high rate of people making the dumb joke: "Are you walking him or is he walking you?!")
Overall, apartments are the place to be—for one, this past year, investor demand returned to the last cycle's peak. So says an upbeat Delta Associates CEO Greg Leisch, whom we snapped chatting with CG Design and Development's Catherine Guentert. Greg, citing demographic shifts, says lifestyle changes are propelling a wave of apartment absorption that's keeping pace with rising production. Apartment dwellers increasingly are living alone (makes it easier to split the chores, or just not do them), driving a shift in the size and mix of units. The average apartment has shrunk by 10% to 15% in virtually every metro market over the past 13 years, but particularly since 2010. With this shrinkage comes more built-in furniture, more common-area amenities, and more obsolescence of older buildings.
The Deal Sheet
Richard Sprenkle bought a 10-unit apartment property in the historic Golden Hill neighborhood (2400-2406 A St) from the Gagon Family Trust for just under $2M. Built in 1915, the property, which sports stained glass windows and crown molding, consists primarily of one-bedroom units with one studio and a two-bedroom penthouse with a rooftop terrace. Colliers' Rita Lancaster-Hannah, who repped the seller, says properties with unique floor plans and features are in high demand. Sperry Van Ness|Finest City Commercial's Jim Taylor and Shelly Bird repped the buyer.
Linfield Investments bought a 6,577 SF office space, 2870 Fifth Ave in San Diego, from Old Fire Station No. 3 Building LLC for just over $2M. Cassidy Turley's Tim Winslow, Jason Kimmel, and Kevin Nolen repped the seller. Coldwell Banker Commercial Lyle & Associates' Dan O’Donnel repped the buyer.
Raintree Residential bought three acres at 1975 Smythe Ave in San Ysidro from G. Foster for $820k. Pacific Coast Commercial's Mack Langston and Icela Galaz-Wittkopp repped the seller. Lee & Associates' Lou Bulte repped the buyer.
Stephen M. Coles Separate Property Trust bought a 6,865 SF retail space in the Santee Town Center, 70 Town Center Parkway, from Milicevic Nikola & Nada Family Trust for $1.6M. Cassidy Turley's Bruce Schiff and Phil Lyons repped the buyer.
Glocal Medical bought a 7,058 SF industrial/flex condo in Carlsbad (3266 Grey Hawk Ct) from Grey Hawk Associates for just over $1M. Colliers International Mike Bench repped the buyer, a custom wheelchair provider doing business as Access Medical. CBRE's Greg Lewis repped the seller.
Liang Trust bought a 4,657 SF industrial space in the El Camino Business Park I in San Diego (6349 Nancy Ridge Dr) from Watts Revocable Trust for $800k. Cassidy Turley's Glenn Arnold and Jeff Sallen repped the seller. Their colleague, Ryan Spradling, along with Irwin Real Estate's Andrew Irwin repped the buyer.
Bottlecraft leased 1,326 SF of retail space at 2250 India St in San Diego for more than 10 years, Cassidy Turley's Michael Burton, Danny Fitzgerald, and Pasquale Ioele repped the tenant as well as the landlord, Danube Little Italy LP.
The Carlsbad office of Colliers International added three VPs from Cushman & Wakefield. Amy McNamara, a 25-year veteran, specializes in leasing and sales of office and medical properties, completing more than $213M just in sales. Marc Posthumus, a 15-year veteran, specializes in office, industrial and R&D leasing and sales with more than $300M in transactions. John Hoffman specializes in office, medical, and R&D sales and leasing in North San Diego County. Over the past 25 years, he's pegged more than 1,000 leases and 30 property sales.