SAUSALITO -- A San Diego-based commercial real estate private-equity firm has made its first foray into North Bay investments with the purchase of 135,000 square feet of buildings in the Industrial Marinship District of north Sausalito for $26.1 million.Westcore Properties LLC
San Francisco office: 235 Pine St., Ste. 1150, San Francisco 94104
Business: Commercial real estate investment
Contact/title: Neil Johnson, principal, director of Northern California acquisitions
Portfolio: $2.2 billion, 10 million s.f.
Facilities: Headquarters in San Diego, offices near Los Angeles and Denver and in Switzerland
Northern California property management: Collette Goodin, Westcore, 510-353-1230 ext. 12
Westcore Properties LLC, operating locally as Westcore Marin LLC, purchased half the seven-parcel portfolio from developer and owner Marin Freeholders LP. At press time, Westcore planned to complete the deal last Friday. California Bank and Trust financed the deal.
"It's big time for Marin County and Sausalito," said Bill McCubbin, president and CEO of commercial real estate brokerage Orion Partners. "You don't get $26 million deals in Sausalito too often."
The largest recent commercial deal in Sausalito was Harbor Drive Executive Park, a 112,000-square-foot class A office development, sold in 2005 to New York-based private-equity firm The Blackstone Group as part of a $270 million portfolio acquisition.
Several dozen industrial, office and art tenants are housed in 11 buildings located on 5.42 acres along Colma Street between Bridgeway and Gate Five Road. The largest is Sausalito Mini Storage, and notable businesses in the complex include the Avatars and Feng Nian restaurants. The buildings are at the north end of what once was the Marinship Corp. shipyards.
Westcore Properties, which owns more than $2.2 billion worth of office, industrial and retail space totaling in excess of 10 million square feet, came out on top of a half-dozen final contenders for the property.
"The property provides a rare opportunity to acquire a critical mass of multitenant product in the severely supply-constrained Sausalito market," said Neil Johnson, a partner in Westcore's San Francisco office in charge of Northern California acquisions.
He noted that the property has suites less than 1,000 square feet, a size range popular to local tenants.
The Marin Freeholders portfolio originally attracted 11 interested buyers when it went on the market in July. That was despite the tight land-use leash Sausalito holds on that part of the city, according to John Greene, co-owner of the property and president of R.H. Greene, a commercial real estate firm co-marketing the property with Jerry Suyderhoud of Orion.
The city in the mid-1980s crafted the Marinships Specific Plan to retain the industrial character of the area in response to office building construction. For example, commercial office and retail space is limited to 40 percent or less of a building on a given parcel, according to the plan.
Westcore's model in other acquisitions has been to upgrade the property to improve the rent base.
In the mid-1960s, Robert Greene and William Stewart III purchased the property and built four warehouses. The other buildings were constructed later.
"Sausalito didn't and still doesn't have much industrial space," John Greene said.
Jeff Traynor of Orion Partners represented Westcore in the Sausalito purchase. Mr. Traynor and Marissa Miller of Orion are marketing the property for Westcore.