Urban Community Purchases City Lights Theater and San Jose Properties for $22MM

Urban Community, Loan Oak Fund, PiMac Mortgage Fund, Gary Dillabough, Jeff Arrillaga, City Lights Theater

By Meghan Hall

The San Jose market is still proving to be a hotspot for local investors. An affiliate of Urban Community, led by Gary Dillabough and Jeff Arrillaga, has purchased a string of parcels near downtown in mid-March. The properties, which include the City Lights Theater, a local non-profit theater company, sold for $22.5 million and were financed by PiMac Mortgage Fund and Loan Oak Fund.

The Mercury News was the first to report on the transaction. In all, there are seven parcels, located at 540 S. First St. and 503, 505,529, 535 and 545 S. Second St. It is unclear at this point how Urban Community plans to redevelop the properties. The parcels are located in San Jose’s South First Area, or SoFa district. The district has long been considered San Jose’s arts, cultural and entertainment hub, with events such as the Cinequest Film Festival and SoFa Street Fair. 

“This property will be a great addition to the other properties in our SoFA district portfolio as we move forward with an integrated approach to projects that will enhance the experience of downtown San Jose,” said Arrillaga in a statement.

It is unclear at this point how Urban Community plans to redevelop the properties, although SoFa itself is in the beginning of its own renaissance. Throughout the 1970s, the district was known as a vibrant commercial neighborhood, but up until recently, San Jose’s development boom has been largely focused elsewhere.

In 2016, Sares Regis Group of Northern California began leasing The Pierce, a mid-rise 232-unit luxury apartment and retail community at 2 Pierce Ave. In  Spring of 2019, a 130-unit mixed-use development was proposed by Acquity Realty, Inc. at 477 S. Market St., while another 280-foot office building at the corner of Almaden Boulevard and Balbach St. has contributed to the neighborhood’s growth.

Urban Community has also been active outside of SoFa, and in February of this year the firm announced a development partnership with Westbank, which includes repositioning the Bank of Italy, Museum  Place, BoTown Valley Title, Fountain Alley and 255 West Julian. According to a press release by the company, Urban Community’s goal is to enhace downtown San Jose, the city in which it is based, through collaboration with community members, designers and others in the AEC community.

West Coast Commercial Real Estate News