By Jon Peterson
Newark, N.J.-based Prudential Real Estate Investors has paid $23 million or $486 per square foot to buy the 47,281 square foot 2190 Shattuck Avenue mixed-use property in Berkeley, according to sources familiar with the transaction.
Prudential did confirm that they were the buyer of the property, but declined to comment on the purchase price and any future plans for the property.[contextly_sidebar id=”v08j6sx5C8uPVnromnRykYeQujVkL25q”]The seller of the property was a joint venture of San Francisco-based Sansome Pacific Properties and Santa Barbara-based Somera Capital Management. Both of these firms did not respond to phone calls seeking comment for this story. This was the same case for the listing agent on the property, the San Francisco office of HFF.
This transaction represents the second time in 18 months that PREI has acquired assets in the East Bay. In October of 2013, the real estate manager paid $132 million to acquire the 555 City Center office building in Oakland.
This activity is reflective of more major institutional investors looking at the East Bay for properties to buy. This is happening due to some very attractive properties being brought to the market for sale and there being a big difference in pricing between the East Bay and San Francisco. Some of the recent deals in San Francisco have been priced close to $700 per square foot.
The mixed-use nature of 2190 Shattuck is a combination of ground-floor retail and office space above it. The retail tenant in the building is Walgreens, which signed a new 50-year lease in 2012 to anchor the property. The office tenants in the property include two technology-oriented companies that are located in creative office space and a medical training facility on the lower level.
There is the potential for the property to be changed in the future. There are provisions in the leases that allow for redevelopment of the property in the future. One potential scenario could be residential. This would allow it to take advantage of its high-end location. It sits directly on top of the downtown Berkeley BART station and is within one block from the University of California at Berkeley.
PREI does have a regional office at 4 Embarcadero Center in San Francisco, according to the company’s Web site. The real estate manager has closed on other deals besides in the East Bay in the Bay Area. At the end of 2014, it paid $95 million to acquire 2305 Mission College Blvd. in Santa Clara.