San Diego Commercial Real Estate Wrap-Up – October 2020

Manchester Financial takes $212 million loan. Partnership wraps up 675-key resort renovation. Catch up with our October selection of San Diego must-reads.
San Diego skyline. Image by Jill Wellington via Pixabay.com

Over the past month, activity in San Diego’s commercial real estate sectors was muted, though certain sectors continue to attract investment. While traditional office properties are facing challenges, the two bright spots in the metro are industrial and life sciences assets. According to a recent CBRE report, San Diego’s life sciences inventory is seeing rising rents amid low vacancy, which is expected to continue into next year. Read our October list of San Diego must-knows: 

1. DEAL – Longfellow Real Estate buys office campus for $113 million.

Shorenstein sold The Foundry, a 280,365-square-foot asset comprising two buildings. JLL brokered the transaction. The property last sold two years previously as part of a $186 million local portfolio sale by PGIM Real Estate, according to Yardi Matrix. Longfellow plans to redevelop parts of the property as laboratory space. The first lab is slated for completion in 2021. Located at 9276 and 9330 Scranton Road, the buildings are within 3 miles of University of California, San Diego.

2. DEVELOPMENT – Westfield upgrades retail center with solar panels.

Westfield UTC is a shopping center located at 4545 La Jolla Village Drive, within 2 miles of Interstate 5. The property was upgraded with more than 2,800 new solar panels, which added to the existing energy system. The improvement was made in partnership with San Diego Gas and Electric. The tenant roster includes Apple, Allen Edmonds and Kendra Scott. In addition to its retail space, the property has a 23-story, 300-unit multifamily component. Westfield similarly upgraded one asset in Silicon Valley and another in Paramus, N.J.

3. FINANCING – Manchester Financial scores $212 million loan for Navy HQ.

The borrower secured the financing from Brevet Capital. The 373,000-square-foot property delivered in late September, and the Navy plans to employ 1,700 military and civilian personnel within the building. The 17-story project replaces a 1920s-era property that will be demolished next year. The structure is part of the 3 million-square-foot Manchester Pacific Gateway mixed-use development.

4. DEVELOPMENT – Lowe and Atlas Hotels complete renovation of 675-key resort.

Town and Country features a mix of one- and two-bedroom guestrooms with private balconies and five top-floor suites of approximately 1,100 square feet. Common-area amenities include a waterslide, fitness center and two swimming pools. The developers also expanded dining options at the resort, which includes a cocktail lounge and a restaurant. The renovated property also has 258,000 square feet of event and meeting space. The 40-acre urban resort is located on Hotel Circle North in Mission Valley.

5. DEAL – Unilev Capital acquires industrial asset for $14 million.

The National City property traded as part of a 1031 exchange. According RENTV.com, CBRE represented the seller, an institutional investor, and Unilev was self-represented. Built in 1969 and renovated in 2002, the 78,700-square-foot asset also includes office space. The facility at 131 W. 33rd St. is within 6 miles of downtown San Diego and 9 miles of San Diego International Airport.