By Jon Peterson
An office building located at 444 South El Camino Real in San Mateo is now on the market for sale. The current owner of the property is the D’Ambra family based in Burlingame, according to public records. This buyer has owned the property since 2007 when it paid $6.53 million, or $192 per square foot for the property.
The seller of the property has engaged the San Francisco office of Newmark Cornish & Carey as the listing agent on the sale. One of the people involved is Steven Golubchik, vice chairman and co-head of commercial capital markets in Northern California. He did not respond to phone calls seeking comment for this story.
The property, which was constructed in 1967, totals 33,982 square feet. The current occupancy of the asset is 17 percent, as stated by sources familiar with the property. This level of occupancy puts it well below the overall vacancy for downtown San Mateo, which currently stands at 9 percent. The existing vacancy of around 23,000 square feet in the property represents the largest concentration of contiguous space in the downtown market.
The location of the building should be a major drawing card for the new owner and for leasing up the empty space. The Class A building is within walking distance to the San Mateo Caltrain station. This means that any employee working at the property can be in downtown San Francisco within 25 minutes, a feature that has become critical for company’s looking for space along the Peninsula.
There is data to support that assets near Caltrain perform better on a vacancy and rental rate basis. According to sources that track this information, the average vacancy rate for Caltrain-served pockets in the Peninsula submarket is around 290 basis points less than non Caltrain served assets. Rental rates are 50 percent higher if the asset is in a property served by Caltrain compared to those that are not.
The overall downtown San Mateo office market has seen a significant increase in rental rates recently. Sources that track this information have indicated that rental rates in the is region have averaged a 32 percent premium over the last three quarters. Part of this is being driven by the fact that there are now 30 active tenant requirements totaling 1.6 million square feet in the Northern Peninsula, which includes downtown San Mateo.
