By Jon Peterson
East Bay housing has had a resurgence since the start of the pandemic, and developers with shovel-ready projects are in some cases looking to capitalize on the demand in the market. Oakland-based Madison Park is one of these entities, and it has placed on the market for sale the 10.16-acre development site in Oakland located at 98th Avenue and San Leandro Street, currently entitled for 408 residential units. The sale of the land has no pricing guidance, and it will be sold on an “as-is” basis, according to sources familiar with the property.
Madison Park has hired the Northern California Capital Markets team from Colliers to lead the marketing initiative. The team working on the marketing efforts includes Matt Kroger, Rick Knauf, Rich Martini, Ryan Wagner and Brandon Geraldo. Colliers declined to comment when contacted for this story.
Madison Park has been working on the approvals for the site for several years. “We have been involved with the development of this site for a long time and secured the full discretionary approval and entitlements in January of this year. Our company is in the apartment rental business, and at this time, we believe this site is best suited to be developed as a for-sale product. Therefore, we have decided to sell the property,” says John Protopappas, president and chief executive officer of Madison Park.
Madison Park remains focused on the apartment rental market, and the company has expanded to several locations across the United States. “We are looking to diversify the geographical locations of our overall portfolio,” said Protopappas, citing a reason for the sale. “We have always had a significant presence in the San Francisco Bay Area. Some of the markets we are targeting include Portland, Kansas City, Mo., Denver and Salt Lake City.”
There are a total of seven parcels that make up the land that the company has put up for sale. While currently vacant, the site was used as a Fleischmann Plant for decades.
Of the approved 408 residential units, 286 units would be developed as rentals and 122 for-sale townhomes. 270 rental units would be low-density apartments, and 7 would be live/work units. Roughly 2,500 square feet of ground-floor commercial space is also planned for the project. One potential development option for the new owner/developer would be partially re-entitle the property be 100 percent townhomes totaling no less than 222 homes.
Protopappas considers that the project could end up as a for-sale only product. “In my opinion, this project is ideally suited to provide transit-served housing at an attractive price point. It really could become single-family housing and condos with the price somewhere in the range of $700,000 to $750,000, which is very difficult to find in the Bay Area. One key part of the buyer pool could be entry-level buyers,” he said.
The development site is located within the I-880 corridor sub-market, near the Coliseum and San Leandro BART stations. Should the new development incorporate some apartment units, they would be located in a region that has seen rental rate growth come back significantly since the start of 2020. According to data from Colliers, rental rate growth in the region for all units has grown by 4.8 percent so far this year, which compares to negative 6.7 percent growth during 2020.