SUNNYVALE, CA--(Marketwire - May 7, 2010) - Trumark Commercial announced today the acquisition of a 130,000-square foot office building in the Perry Park area of Sunnyvale in Silicon Valley.
The two-story property located at 645 Almanor Ave. -- southwest of the intersection of Highway 101 and N. Mathilda Ave. -- sits on approximately seven acres and was built in 1972 in the concrete tilt-up style. It is near a number of technology companies with freeway visibility from Highway 101. The site includes approximately 650 parking spaces. It has been vacant for several years.
"We saw a lot of potential and opportunity with this," said Ron Winter, a principal of Danville, Calif.-based Trumark Commercial. "We've held back the past few years, but are now very excited about this property and how it fits with our growth outlook."
A $6- to $7-million renovation of the property is set to begin in three months and be completed by the year's end. The work planned seeks to achieve a LEED certification and will be environmentally friendly. Most of the material taken out will be recycled. New features will include: the use of recycled materials, the addition of windows and lobbies, a new exterior curtain wall of aluminum and glass, a new roof and modernized heating, ventilation and air-conditioning systems.
"We're taking an older office building and completely transforming it into something new, which will help create a better image for the area and provide a terrific work environment for the new occupants," Winter said.
The building would be ideal for a single tenant looking to integrate its workforce in one location, but multiple companies could share the space. While the vacancy rate of R & D buildings in the Mt. View to North San Jose corridor is around 18% to 20%, similar buildings of over 120,000 square feet have a much lower rate of approximately 7%. Trumark expects to be competitive with its leasing after having a low cost base for the acquisition.
"We saw a niche in the market for an office building of this size. There's no other space like this vacant in Perry Park and the demand is there," Trumark principal and co-founder Gregg Nelson said.
The project was acquired in joint venture with Harbert United States Real Estate Fund IV, L.P., an equity investor sponsored by Harbert Management Corporation, which also will fund the renovation. Nelson pointed out, "Harbert is a premier equity firm and saw the significant opportunity this project offers." As Trumark looks to add more properties, it also seeks options with debt for construction financing.
The all-cash transaction was brokered by Jeff Ramirez and Christine Slonek of Cornish & Carey Commercial in Santa Clara, Calif., working directly with Zack Haller, who leads Trumark's acquisition initiatives for commercial development.
"Our relationship with the brokers and our ability to get this done quickly worked very well for us," Nelson added. "This project has been in escrow before and never closed, so the seller was looking for someone they could rely on to perform, complete the transaction and get it done."
About The Trumark Group of Companies
The Trumark Group of Companies is a diversified real estate developer and builder with expertise in land acquisition, homebuilding, community design, entitlements and office, R&D and retail development. Trumark Companies is the residential development arm of the organization and operates in Northern and Southern California. Trumark Commercial, which builds, leases and sells commercial buildings, operates in the northern portion of the Golden State. Trumark Homes builds high-quality homes at competitive prices throughout California and has positioned itself for the housing market rebound. Additional information is available at www.trumark-co.com
About Harbert Management Corporation
Harbert Management Corporation is an investment management firm with approximately $2.7 billion in committed capital and assets under management across ten asset classes as of January 1, 2010 in three areas of concentration: real estate, private capital and absolute return strategies. HMC is headquartered in Birmingham, Alabama and has offices in the United States in Atlanta, Nashville, New York, Richmond and San Francisco, as well as offices internationally in London, Madrid, Melbourne and Paris. For more information please visit www.harbert.net/
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