This Week's Bay Area Deal Sheet
The Bay Area's retail real estate sector could get a boost from a new law allowing cannabis cafes and lounges in California.
Assembly member Matt Haney sponsored AB 1775, which allows cities and counties to operate Amsterdam-style cannabis cafes, Sacramento’s NBC affiliate KCRA reported.
Existing cannabis vendors can now establish lounges or rooms for consumption on their properties.
Food and beverages will also be available at these establishments, as well as music and live performances.
SALES
In a deal demonstrating investors’ growing appetite for suburban commercial facilities, San Francisco-based industrial REIT Prologis has acquired four buildings in Fremont for $71.3M.
The sale price for 46897 Bayside Parkway was nearly 25% higher than the asset’s $57.8M value in January, according to SiliconValley.com, citing data from the Alameda County Assessor’s Office.
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Pacific West Communities acquired an undeveloped site at 41st Avenue and Soquel Drive near Santa Cruz in Soquel. The seller was Blam Jade LP, owned by the Groppetti Automotive Family, which initially planned to develop a Nissan auto dealership on the site. The site has never been occupied.
Cushman & Wakefield has brokered the 2.6-acre sale where Pacific West and its partner Linc Housing plan to build a fully affordable 289-unit housing project. Redevelopment costs are expected to total more than $200M, according to a press release.
Plans call for the delivery of two five-story buildings comprising 118 studios, 116 one-bedrooms, 22 two-bedrooms and 33 three-bedroom units.
LEASES
Biotech company Surrozen Inc. extended its lease for nearly 33K SF at 171 Oyster Point Blvd. in South San Francisco from HCP Oyster Point III LLC.
According to an SEC filing, the lease term begins May 1, 2025, and expires April 30, 2029. Rent escalates from $2.3M in the first year to $2.6M for the final 12-month period. Surrozen has an option to terminate the lease for $400K by September 2025.
DEVELOPMENTS
West Palm Beach, Florida-based private equity investors plan to convert a former Fry’s Electronics big-box store into an industrial building in Fremont.
A Sterling affiliate acquired the 143.8K SF retail property at 43800 Osgood Road, for $35.7 million, or $248 per SF, according to The Real Deal. An affiliate of Quality Real Estate sold the 11.2-acre asset.
Both Fry’s and Quality Real Estate were once based in San Jose.
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California Gov. Gavin Newsom announced plans to deliver more affordable housing in San Francisco.
According to the San Francisco Chronicle, the current site of a circa-1960 Department of Motors Vehicles building in disrepair at 1377 Fell St. will be demolished. It will be replaced with a 372-unit affordable housing project, a new DMV facility and parking spaces.
If approved, the NoPa complex’s tallest building would reach eight stories.
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The University of California, San Francisco is eyeing plans to anchor the 21-acre Potrero Power Station, a former coal-powered plant.
Pending sign-off by the UC Board of Regents, the university would build a state-of-the-art clinic, cancer treatment center and health technology incubator encompassing 50K SF, the San Francisco Chronicle reported.