Historic Building in Escrow for Residential, Office Conversion

PETALUMA, CA-One of Petaluma’s landmarks, the Sunset Line and Twine Co. building, is slated for conversion to condominiums and office space by a group of investors who have tied up the property. The tenant, Sunset Line and Twine, has occupied the 43,500-sf building since 1940 and will continue to do so for another 2.5 years while it locates and prepares a new facility elsewhere in Petaluma. The seller is a group of former owners of Sunset Line and Twine, which sold the business five years ago to its largest customer and leased it back to them for five years. The building was put on the market because the tenant was going to vacate the premises at the end of its lease rather than afford the $1.5-million seismic retrofit required by the city before 2012. The buyers, Petaluma Preservation Group LLC, plan to invest $12 million to renovate the building, including seismic retrofit. The negotiated sale price has not been revealed, but Petaluma Preservation group partner Skip Sommer, a local real estate agent, tells GlobeSt.com the property will sell for “significantly above” the $4.5-million asking price. The other principals of Petaluma Preservation Group are Robert Mitchell, a Petaluma general contractor; Ravi Anand, a San Rafael architect; and Michael Troy, a former Petaluma resident and founder of the software developer KnowledgePoint. The listing broker is James Manley of Keegan & Coppin Co. The conversion plan calls for most of the building’s ground floor to become office condominiums. The second floor is slated for division into 16 residential condominiums. Exterior renovations, such as replacing 200 windows, landscaping, roofing, will get underway while the tenant is still in the building. When the tenant vacates the building in 2.5 years, the second-floor condominiums will be completed first, followed by the ground-floor office space, which may also include one restaurant space, says Sommer.The residential condominiums will average 1,050 sf. The tentative selling price will be around $610,000, which equates to about $580 per sf. The price is tentative because the condos won’t be ready for occupancy for three or four years. The east facing units will have views of the Sonoma Mountains and the West facing units will have views of McNear Peninsula Park. The pricing on the office still has not been hammered out.