PUBLICATION: IPE Real Estate
DivcoWest has raised $2.25bn (€1.9bn) for its latest US real estate fund to invest mostly in value-add office and life science-related properties.
DivcoWest said the DivcoWest Fund VI, which was launched in October last year to raise $1.5bn with a $2.25bn hardcap target, achieved a final close at the end of September.
The predecessor DivcoWest Fund V fund…READ MORE
Publication: Nevada Business
BY: Abbi Whitaker
INOVA luxury apartments at the Summit, the new apartment homes in South Reno geared toward creativity and a spirit of collaboration, launches a community campaign to celebrate local artists called The Art of Innovation.
Presented by Bob Klein of Klein Financial Corporation, Chip Bowlby of Reno Land, and DivcoWest, the Joint Venture developers of INOVA, The Art of Innovation community campaign is an expression of their commitment to build upon Reno’s identity as a leader in art and innovation.
“Inova, named for its commitment to innovation defines the next generation of Reno living, integrating innovation and art, with luxury and convenience to elevate residents to live life inspired,” Bowlby said. “This philosophy is woven in the property’s fabric, and we are bringing light to it in the form of a competition. The Art of Innovation competition gives artists a chance to connect and create work during a time when our community is looking to be inspired.”
The art competition will include a purse total of $10,000, with first, second and third place winners across three different categories chosen, as well as a Best in Show. Categories include photography, painting and sculpture. The top 50 entries will be included in a book, “The Art of Innovation” with the artists’ information and the cost of each piece shown.
Artists are invited to present existing work as well as original works of art yet to be produced. The deadline for the last submission will be August 30, 2020 and a $10 entry fee will be collected per entry. In addition, The Sierra Arts Foundation, a nonprofit art organization working with integrating art in schools, will work with local schools as they try to spark creativity with their students from home. INOVA will be awarding $3,500 for this unique student contest.
“Northern Nevada is a community fueled by arts and culture,” said Reno Mayor Hillary Schieve. “During this time, when many of our residents are staying at home to prevent the spread of COVID-19, I see this competition as an opportunity for creatives to share their work and inspire others.”
This campaign invites local Reno artists, as well as others from across the nation, to create a visual expression that demonstrates what innovation means to them. Contest judges include Burning Man artist Andrew Johnstone; Executive Director of Artech and Project Manager for Playa Art at Burning Man, Maria Partridge; and retired Manager of Arts and Culture for the City of Reno, Christine Fey.
Johnstone, a British artist now living in the Bay Area, has been working on the design of “The Man,” the centerpiece of the Burning Man festival, each year since 2005. He is a muralist specializing in photo real trompe l’oeil (deceive the eye), and his clients recently have included The Smithsonian, Chabot Space and Science Center, Stanford Medical Center, Venice Biennale Arte, European Cultural Academy and NASA. Johnstone also became one of the Newzonia 500 ambassadors, a group of artists, scientists, Nobel laureates working on global and sustainable solutions for a world in crisis.
Both Partridge and Fey have strong roots in the local arts community, Partridge spearheading efforts to place temporary installations of Burning Man art in downtown Reno, and Fey who worked for two decades as the Arts and Culture Manager, and is the City Liaison to Artown and Sierra Arts Boards.
“Celebrating arts and culture within our community is essential,” Partridge said. “During this time of uncertainty, art can lift our spirits and provide a sense of community. Through The Art of Innovation competition, we seek to embrace the artists in our community and showcase their incredible work.”
Publication: Connect California
Dewey Land Company and DivcoWest received $33.8 million in construction financing for the speculative development of 250 California, a 44,605-square-foot office property in Burlingame, CA. JLL Capital Markets’ Jordan Angel and Chris Gandy arranged the financing, as well as a joint venture equity partnership between the developers.
Due for completion in 2022, 250 California will feature four stories of best-in-class office space, ground-floor retail and a three-level subterranean parking facility. The transit-oriented building has a premier location in downtown Burlingame, immediately adjacent to the Burlingame Caltrain station.
DivcoWest’s Chris Eldemir says, “250 California is an excellent, transit and amenity-friendly location which has already drawn a major VC tenant. We’re excited to have the opportunity to partner with our friends at Dewey Land Company, and look forward to delivering a high quality, boutique office building to the downtown Burlingame market.”
Publication: IPE Real Assets
BY Jon Peterson
California State Teachers’ Retirement System (CalSTRS) has been seeking to increase its exposure to real estate debt, offices and property funds via the secondary market.
As part of more than $2bn (€1.74bn) committed to real estate strategies in the second half of 2019, the $252bn pension fund allocated $648m to real estate debt investments.
CalSTRS confirmed to IPE Real Assets that it had committed $300m to 3650 Cal Bridge Lending, a real estate debt joint venture it established with 3650 REIT in 2018.
The pension fund said it had also committed $198m to PacificCal Debt III, a joint venture with PCCP, and increased its existing investment in an open-ended real estate debt fund managed by CrossHarbor Capital Partners by $150m.
CalSTRS also allocated $300m of new capital to BCal II, an existing joint venture with Beacon Capital Partners that invests in core US offices, and committed $300m to the office-focused DivcoWest Fund VI.
The pension fund is also investing in real estate funds on the secondary market, having set up a $400m separately managed account with Blackstone Strategic Partners.
Other commitments in the second half of 2019 included a $300m allocation to StradaCal, a joint venture targeting core apartments and mixed-use assets in the San Francisco Bay Area and West Coast markets.
Publication: Connect Media
BY Dennis Kaiser
In September 2017, DivcoWest and its local operating partner Ocean West, acquired a 1980s-era office building at 1420 Kettner Blvd., in downtown San Diego’s Little Italy district. Upon move-out of the former tenant and owner, U.S. Bank, DivcoWest and Ocean West immediately began a major renovation of the 123,000-square-foot building with the goal of converting it to a highly-stylized, boutique, Class A, office project that would appeal to a broad base of modern tenants. Prior to completion, and just 12 months into the project, the building’s leasing agents, Derek Hulse and Phillip Roberts of Cushman & Wakefield, announced a lease for the first three floors of the building with Spaces, an international co-working operator. Rebranded “Kettner & Ash,” the building reopened last month.
We asked Gregg Walker, DivcoWest’s Head of Business Development, to take us behind the redevelopment, and explain what sets the building apart from its neighbors, as well as why DivcoWest sees tremendous potential and opportunity in downtown San Diego.
Q: Gregg, what about Kettner & Ash appeals to tenants like Spaces?
A: Kettner & Ash has all the elements of a great building. It’s in a great location for tenants that want to be downtown, it’s walkable to more than 60 local restaurants as well as amenities throughout Little Italy, it’s close to major public transit, and it’s easily accessible from major freeways like I-5. Additionally, it is easy to get to and from the airport, and it’s surrounded by great housing options for employees who live, or want to live, in downtown San Diego.
We have also added amenities to the building that appeal to our target tenant base. For example, we have emphasized and invested in the building’s outdoor spaces, creating a common area balcony on the third floor that connects with an indoor tenant lounge. The tenant lounge provides a great venue for tenant to host events, meetings or just relax. The project offers resort-style locker rooms and showers for tenants who want to exercise at lunch or throughout the day, and the building also has its own café.
Q: What’s the timeline for Spaces to move in, and what does it mean to have a co-working tenant in the building?
A: We expect Spaces will move in sometime around early summer. Having a co-working space in the building, and in the neighborhood, acts as an incubator for entrepreneurs and start-ups who will continue to grow the business ecosystem in the downtown market. Furthermore, it spurs innovation and company formation, and provides our existing tenants flexible workspace when there is a need for immediate expansion or special projects
Q: What attracted DivcoWest to downtown San Diego?
A: We’ve had a lot of experience in innovation markets around the country, from Silicon Valley and the Bay Area to Seattle, Boston, Austin and New York. We see a lot of the same dynamics we’ve seen in those markets developing in San Diego. There is already a strong innovation economy here, great universities creating future tech entrepreneurs, and we see the beginnings of a migration toward downtown as a corporate location. San Diego has a high percentage of Millennial workers in its population, and that demographic wants to be downtown where there is vibrancy and more relevant lifestyle options for them than they might find in the outer suburbs. Downtown still has housing options that compare favorably to other higher-priced West Coast markets, and the development going on right now will continue to attract employees of the innovation economy. That means employers needing to recruit and retain talent are starting to follow. We’re also seeing a trend toward companies operating a ‘distributed real estate’ model. So, while they may keep a headquarters in the suburbs or a nearby market, they may want another location so that their employees living or moving downtown have a space to work and no commute, as well as tapping a larger labor pool for recruiting new employees.
Publication: The Real Deal
BY Tina Daunt & Jerome Dineen
An affiliate of investment firm Rockwood Capital has paid $65.7 million for the 1930s-era Telephone Building in Santa Monica. Verizon maintains a condominium stake in the creative office property.
The seller, DivcoWest Real Estate Investments, had acquired the 58,000-square-foot building three years ago for $52 million.
The most recent sale pencils out to around $1,100 per square foot, compared to the roughly $900 per square foot DivcoWest paid. San Francisco-based DivcoWest, founded by Stuart Shiff, announced the deal. JLL’s Andrew Harper, Michael Leggett, Doug Bond and Matt McRoskey represented the seller.
DivcoWest undertook further improvements on the building, after Pacshore spent three years restoring, updating and seismically retrofitting it. Pacshore paid $19.5 million for the property in 2012, in partnership with Boston-based Alcion Ventures.
In 2018, DivcoWest secured landmark status for the six-story complex, which was constructed in the Art Deco style and the federal government used it after the Great Depression.
DivcoWest still has a strong presence in the Los Angeles area with high-profile properties that include 331 N. Maple Drive office complex in Beverly Hills — built by David Geffen — 1600 Vine apartment complex in Hollywood and the UTA Plaza office campus in Beverly Hills.
SANTA MONICA – January 17, 2020 – DivcoWest has sold its interest in the Telephone Building, a historic, six-story building in downtown Santa Monica, Calif to an affiliate of Rockwood Capital. Terms of the transaction were not disclosed.
DivcoWest purchased the 58,000 square foot creative office and retail interests in the property in 2017. Over its ownership, DivcoWest completed lease-up, made capital improvements and achieved historical landmark status for the building from the City of Santa Monica under the Mills Act, a move which will ensure preservation of the Art Deco structure.
“Santa Monica’s growth has continued to excel in recent years and the Telephone Building’s location and unique appeal to tenants as a jewel-box asset, with landmark status, will preserve its long-term value. We’re proud of the opportunity to have owned it and are confident it will flourish in its next chapter under Rockwood’s stewardship,” said Mike Provost, Managing Director at DivcoWest.
A JLL Capital Markets team led by Managing Director Andrew Harper, Senior Managing Directors Michael Leggett and Doug Bond and Associate Matt McRoskey represented the seller.
DivcoWest currently owns several major commercial assets in Southern California including 331 N. Maple, 1600 Vine, UTA Plaza in Los Angeles; Glendale Plaza in Glendale; and 1420 Kettner and DiamondView East Village in San Diego. The company focuses on acquiring and improving commercial assets in strong innovation markets. It also has major holdings in the San Francisco Bay Area, Austin, Boston, New York City, Seattle, and Washington DC.
Publication: Globest.com
BY Lisa Brown
2 West Santa Clara was built in 1910 as the headquarters of First National Bank and most recently was the offices of lumber company, Pacific States Industries, with a Walgreens on the ground floor. In 2017, DivcoWest acquired the value-add investment in the part of downtown where Google has accumulated a large number of properties.
Later that year, DivcoWest began a renovation of the building, which will be ready for occupancy in the first quarter. The renovation includes updating the facade and office interiors to appeal to a more creative tenancy.
“DivcoWestrs comprehensive modernization program has transformed 2 West Santa Clara into an unmatched creative office location in the heart of downtown San Jose,” Jeff Arrillaga of Newmark Knight Frank tells GlobeSt.com.
The 100,000-square-foot building has been a single-tenant location in the past, and possibly could be again. However, the opening up of each of the 10 floors and connecting of the first and second mezzanine floors means that the property should appeal to a broad range of tenants including smaller users looking for a full floor of space. Floorplates run from about 7,000 square feet to 12,000 square feet, and the first and second floors together could provide up to 21,500 square feet if taken together and interconnected. The renovation opened up the space to provide higher ceilings, more natural light and minimal column lines.
One of the highlights of the renovation is the private roof deck located on the fifth floor, which creates an outdoor workkommunity space with views of the hills and downtown.
Another key selling point of the building is its location near many existing planned major public transit options. It sits next to a Valley Transit Authority light rail station, allowing quick access to the airport, Diridon Station (the epicenter of Googlers proposed campus) and surrounding areas including Mountain View. It is also near the proposed site of the future BART station in downtown San Jose. And, it is surrounded by retail, restaurant, hotel and other amenities including the San Jose Art Museum two blocks away.
The brokers marketing the space are Arrillaga and Michael Saign of Newmark Knight Frank.
“The combination of customizable, creative interiors and a private roof deck are two of the project features we have received the most excitement about to date,” Saign tells GlobeSt.com.
Office activity in Silicon Valley remained strong in the third quarter of 2019, posting positive net absorption for the eighth quarter in a row and bringing the year-to-date total absorption to just under 1 million square feet, according to a third quarter office report by Newmark Knight Frank. The office market showed a slight slowdown with net absorption of 129,780 square feet compared with the second quarters 461,828 square feet. Moreover, the total square feet leased increased by more than 1.8 million to 4.45 million square feet, says NKF.
Publication: Commercial Property Executive
BY Lisa Brown
Kairoi Residential of San Antonio, Lincoln Property Co. of Dallas and DivcoWest of San Francisco have formed a partnership to develop the 6xGuadalupe project, a mixed-use tower in downtown Austin, Texas. The site preparation will begin with the demolition of the existing Extended Stay America hotel located at 600 Guadalupe St., scheduled for October 29.
The LEED Gold-seeking AAA-Class project will rise 66 stories high, totaling 587,780 square feet and will comprise 349 multifamily units on floors 33 through 66, office floors between levels 14 and 32, as well as 11 floors of parking and 14,550 square feet of ground-floor retail space. Office floor plates will range from 30,241 to 35,501 square feet. The office portion is slated for completion in late 2022, while the delivery date for the residential portion has yet to be announced.
The building will feature private outdoor terraces totaling 35,000 square feet, an on-site fitness center and high-speed elevators. The residential units will include a number of penthouses with access to a private rooftop club room, dining room, outdoor amenity deck and swimming pool.
Lincoln Property Co. is the developer of the commercial segment, while Kairoi Residential will handle the construction of the multifamily component. Gensler is the project’s architect.
NEW YORK – August 8, 2019 – DivcoWest purchased 540 Madison Avenue, a Class A, 39-story, ~291,000 square foot, boutique office tower in Midtown Manhattan’s Plaza District.
Convenient to multiple subway lines and a short walk from Grand Central Terminal, the building’s floor plates range from +/-7,000 – 11,500 square feet, customizing to full-floor users.
“DivcoWest continues to like New York’s fundamentals as an innovation hub,” said Ariel Aber, Senior Director-Acquisitions, “We are pleased to add 540 Madison Avenue to our portfolio and believe its core and central location, surrounded by transportation and amenities and strong tenant roster make it an attractive building.”
DivcoWest plans to locate its New York office at the property.
