Shorenstein Picks Up Mission Bay Parcel Entitled for 450,000 SF

SAN FRANCISCO-Locally headquartered fund sponsor Shorenstein Properties LLC closed this week on its acquisition of a 3.8-acre Mission Bay parcel entitled for 450,000 sf of commercial office and retail or laboratory space. The Mission Bay submarket is a 303-acre, mixed-use development that upon completion will include 6,000 units of housing; five million sf of office, research & development, and biotech/laboratory space; a 500-room hotel; landscaped parks; and retail amenities. A significant portion of that will be developed by the University of California at San Francisco, which is in the early stages of developing a $1.5 billion biomedical research and teaching center with 2.65 million sf of facilities. Another 1.4 million sf is being developed by publicly traded life sciences REIT Alexandria Real Estate Equities.The Shorenstein parcel used to hold an Esprit clothing warehouse and offers unobstructed views of San Francisco Bay. The seller is listed as ECOR-SF Holdings Inc. Shorenstein declined to comment on the purchase price, but local brokers have told GlobeSt.com that entitled land in Mission Bay is going for upwards of $60 per sf of space that could be built. At that price, Shorenstein would have paid between $27 million and $30 million for the property.Shorenstein chief executive Doug Shorenstein says the company is “extremely” bullish on Mission Bay. He expects the company’s site will be attractive to biotech and life science companies, healthcare organizations, professional service firms and academic institutions. “The area is in the path of growth… (and) this is one of the last independently-owned, developable commercial sites in the area,” he says. Shorenstein is now investing its seventh closed-end investment fund, which had committed capital of $775 million. The Mission Bay property is the fund’s fourth asset. Last month, Shorenstein acquired a significant but minority interest in Starrett-Leigh, a 2.3 million-sf office complex in West Chelsea, NY whose ownership includes Mark Karasick. The other two properties in the fund are Mission Towers II in Santa Clara and 1155 Perimeter Center in Atlanta.