After just a couple of months on the market, a San Mateo property has found a willing buyer at nearly the guidance pricing established by the seller at the start of the year. The property is a two-building asset, which San Francisco-based Rubicon Point Partners sold to Durham, NC-based Longfellow for $154.6 million, according to public documents. The guidance pricing Rubicon had placed on the sale was around $160 million, as The Registry reported earlier this year. Each property traded for $77.3 million.
Rubicon had owned the office complex since 2016. At that time, it spent $152 million to acquire three buildings at this property, and it placed two of them, 901 and 951 Mariners Island Boulevard, in one entity and the third one, 999 Baker Way, was placed in a different one.
The Mariners Island Boulevard properties are the ones that Longfellow purchased, and they total 245,563 square feet, making the sale $635 per square foot. The assets currently are 88 percent occupied. Two of the existing tenants in the property include Marketo and Sares Regis Group, according to both of the firm’s websites.
The listing agent on the sale was the San Francisco office of Newmark. A lead person working on the sale was Steven Golubchik, a vice chairman with the firm.
The new ownership will have a potential leasing opportunity with the buildings and also the possibility to convert part of the structure to a life science asset. There is roughly 200,000 square feet in the property that can be rolled over in the first three years of new ownership if the buyer wants to create a life science asset, according to market estimates.
This conversion would make sense for Longfellow, which focuses on delivering holistic real estate solutions for life sciences and technology organizations, according to the firm’s website. These two buildings are right in the sweet spot of that strategy. Also, the location is in close proximity to Longfellow’s Redwood LIFE campus in Redwood City, which is comprised of 20 buildings totaling 1,006,092 square feet and a key part of the tech and life science cluster thriving in and around San Francisco.
The two buildings just acquired have seen $17 million of capital invested in the property over the past six years. The improvements have included a new gym, café, outdoor amenity areas, roofs, lobby upgrades, HVAC renovation, elevator modernizations and parking lot resurfacing.
Rubicon had acquired San Mateo Bay Center in a joint venture with Los Angeles-based Canyon Partners Real Estate as part of the Canyon Catalyst Fund. This is the emerging manager program that has been established by the California Public Employees Retirement System (CalPERS).