Silicon Valley Project Lands $79M Construction Loan
- Jun 29, 2017
San Francisco-based PCCP LLC has provided a $78.6 million construction loan to Lane Partners for Broadway Station, a 114,859-square-foot, Class A office building in downtown Redwood City, Calif.
Lane Partners, of Menlo Park, Calif., has already preleased all of the four-story building’s office space to the Chan Zuckerberg Initiative. CZI was founded in 2015 by Facebook founder Mark Zuckerberg and his wife Priscilla Chan, with the mission to “advance human potential and promote equality in areas such as health, education, scientific research and energy.”
In addition to the office space, Broadway Station will have about 12,800 square feet of ground-floor retail space with frontage on both Broadway and Jefferson. The building will feature two outdoor terraces totaling 6,000 square feet, two levels of underground parking, 15-foot clear heights between upper floors and 20-foot clear height for ground floor office and retail.
The site is less than a mile from Interstate 101 and three blocks from the Redwood City Caltrain Station, one of four Silicon Valley “baby bullet” stops that provide public transportation between San Francisco and San Jose.
“We really believe in this project as it has a strong local developer that is building a well-located, transit-oriented office product in the Bay Area,” Erik Flynn, a managing director with PCCP, said in a prepared statement. With this loan in place, construction will start in the third quarter and is expected to be completed in summer 2019.
Neither PCCP nor Lane Partners replied to Commercial Property Executive’s requests for additional information.
Office Market Insights
Though the Greater San Francisco Peninsula office market started the year in an excellent position, some signs suggest that “a modest slowdown in record growth could be in the future,” according to a first-quarter report by Colliers International.
San Mateo County’s average vacancy crept up slightly towards the end of the first quarter to 7.1 percent, its highest point since the end of 2015 and somewhat higher than the Peninsula’s overall average of 6 percent. Another possible sign of a slowing market is San Mateo County’s total gross absorption of 533,220 square feet, which is well below the average over the past two years, the Colliers report added. Further, sublease space now represents 25.60 percent of available office space in San Mateo County.