Twin Seaport Assets Flip for $240M Plus

REDWOOD CITY, CA-Locally based Shorenstein Properties LLC has acquired 1400-1500 Seaport Blvd., a pair of connected five-story buildings here for somewhere between $240 million and $250 million, local industry sources tell GlobeSt.com. Completed in 2002, the 447,747-sf development is 100% leased to PDL Biopharma, a biopharmaceutical company that plans to relocate its headquarters and other operations to the buildings later this year from Fremont.

The two buildings are part of the 10-building, 1.7-million-sf Pacific Shores Center, a multi-tenant, 106-acre campus with the amenities of a high-end corporate campus such as Nike’s in Beaverton, OR. The seller, Starwood Capital Group of Greenwich, CT, acquired the overall development from Jay Paul Co. for $825 million or $485 per sf shortly before the start of the year and immediately set out to flip 1400-1500 Seaport, the core nature of which doesn’t mesh with Starwood’s opportunistic strategy.

PDL has committed to lease the two buildings through December 2021. The 164,000-sf building at 1500 Seaport was in shell condition when PDL signed its lease. It is being built out as lab space. The 283,000-sf building at 1400 Seaport, which is being subleased from OpenWave Systems for the first seven years, was already finished and fully furnished and will be used for PDL’s administrative offices. The published triple-net asking rate for 1500 Seaport at the time the lease was signed was $21 per sf per year.