By Jon Peterson
As if the nearly 5,000-unit Bay Area apartment portfolio it is acquiring in the Archstone sale weren’t enough for Equity Residential, the Chicago landlord continues its steady regional expansion, this time in Berkeley.
With approval from the city’s Zoning Adjustments Board behind it, the publicly traded real estate investment trust expects to start construction early next year on the $90 million Acheson Commons, a more than one-acre redevelopment project that includes renovation of multiple historic buildings immediately east of the University of California campus.
“Berkeley is a market that we are very familiar with. We already own eight buildings totaling 600 units. It is one of our core markets in the Bay Area,” said Peter Solar, a vice president of development for Equity Residential. “It’s attractive because of its high barriers to entry, a highly educated workforce and the high level of public transportation that already exists.”
Equity Residential has owned the Acheson Commons site since 2010 when it paid $13.5 million to the Reeves Trust to buy it. It submitted its first application to the city of Berkeley in November that year.
The project is to include the complete rehabilitation of the four-story, 1925 Beaux Arts-style landmark Acheson Physicians building and the partial rehab of two other landmark historic buildings and a third building eligible for the California Register. New structures are to be added to the top of the landmark MacFarlane and Ace Hardware buildings and the Boldt/Krishna Copy building, which is eligible for California recognition.
The apartment company hopes to start the project in the first quarter of 2014 and plans 24 months to complete it.
Solar works from the company’s regional office in downtown San Francisco at Market and 3rd streets.
In all, Equity expects to have not quite 26,000 square feet of retail and 205 apartments, 184 of which are market-rate and 21 below-market rate. All of the existing offices on the property—about 17,000 square feet—will be removed. Oakland-based Kirk E. Peterson & Associates Architects and Rhoades Planning Group are overseeing the project’s design.
“We plan to ask the Ace Hardware store to remain in the project. We are also thinking that there might be a restaurant or deli with some outside seating,” Solar said.
The existing Acheson Commons has been less than 50 percent occupied for some time.
Equity expects to spend $30,000 a year supplying every apartment resident in the complex a free transit pass. The complex also is expected to have a pet-washing area, Solar said. There also will be an area on-site for any resident to complete bicycle repairs.
“I would think that people who work at the University of California at Berkeley could live in our property. Students at the school could be residents in some of the below-market units. Given that we are one-and-a-half blocks from a BART station, we should attract people who work in downtown San Francisco,” too, Solar said.
Equity Residential has multiple development and redevelopment projects either under construction or in planning in the Bay Area. The first units of a 444-unit project in San Jose will be delivered in June. Construction will start on the 554-unit Equity Tasman project in North San Jose in September. In March the company expects to start construction on the 273-unit Block 13 project in Mission Bay in San Francisco.
The REIT hasn’t named a planned project at Lorton and Howard avenues in the posh Peninsula community of Burlingame where it hopes to replace an existing parking facility with a multi-level, 140-apartment and parking complex.