An investor group in California recently bought a downtown office building in Santa Rosa, a little more than an hour from San Francisco. The office building spans more than 66,000 square feet. The commercial real estate purchase was executed for more than $12 million.
The real estate investor group bought the building, which is anchored by a Westamerica Bank, in early August, for an amount equivalent to more than $187 per square foot. This is actually relatively low when compared with other area buildings' sales prices. The price was so low because it was over 20 percent vacant when the sale took place.
When the sale happened, the office building also had a large amount of deferred maintenance. In addition, some tenants in the building were on leases that were shorter term. However, two leases executed since the building was sold have elevated occupancy to a whopping 88 percent. In addition, three potential tenants are eyeing the four suites that remain available, spanning between 1,500 and 3,000 square feet. This recent transaction shows that the market for office space is on an upswing right now, at least in this geographical area.
Purchasing commercial real estate can be a tricky endeavor, depending on the circumstances surrounding the deal. The complexities of a deal can understandably make it overwhelming on the seller side of the deal as well. However, an attorney in San Francisco can provide help navigating even the most complicated of deals to make sure that the most personally favorable deal is sealed in the Golden State.
Source: northbaybusinessjournal.com, "3 notable Sonoma, Marin commercial real estate sales", Jeff Quackenbush, Sept. 20, 2017