Six-Property Portfolio Has Developable Value of $500M+
Given the continued strength of the San Francisco residential market, despite COVID, Allrise envisions the creation of several multi-purpose buildings comprised of more than 800 residential units in the next several years.
SAN FRANCISCO—Allrise Capital recently gained full control of a portfolio of mixed-use real estate properties in San Francisco and Berkeley through the acquisition of its minority partner’s interest. The global investor now has 100% ownership of six development projects with a combined developable value of more than $500 million.
“Gaining full ownership of the portfolio provides us with the ideal opportunity to utilize our expertise in transforming underutilized properties and sites into successful assets that bring value not only to our partners, but the neighborhoods and communities in which they are located,” notes Ruslan Zinurov, CEO of Allrise Capital. “Given the continued strength of the residential market in San Francisco, despite the challenges of a global pandemic, we envision the creation of several multi-purpose buildings comprised of more than 800 residential units over the next several years.”
The multifaceted deal included the acquisition of multiple existing properties that will benefit the community at large while creating development projects that will further strengthen Allrise’s position in the market. Among the portfolio assets are 598 Bryant St., 650 Harrison St. and 1394 Harrison St. in San Francisco as well as 1835 San Pablo Ave., 2198 San Pablo Ave. and the pending purchase of 2136 San Pablo Ave. in Berkeley, CA.
1835 San Pablo Ave. is a vacant property that is fully entitled for a mixed-use building consisting of live-work and low-income resident units. In addition, 2198 San Pablo Ave. is a retail property that is also fully entitled for the development of a mixed-use multifamily building.
598 Bryant St. was a former Shell gas station. The property has unobstructed views to the west, as the new zoning restricts the height limit to 50 feet.
650 Harrison is a proposed multifamily property entitled for roughly 115 units, GlobeSt.com learns.
Finally, 1394 Harrison St. is an industrial property that will be redeveloped to a mixed-use building containing single residence occupancy units and retail space.
These types of acquisitions are proving San Francisco’s rental mettle, say brokerage experts. While COVID has been a constant presence in the city’s economy since March, the fundamentals of its multifamily market remain solid, says John Antonini of Compass Commercial Real Estate.
“The rental market in San Francisco has undeniably cooled, which is predictable given the restraints COVID has put on urban living and working,” Antonini tells GlobeSt.com. “Rents are down 5 to 15% depending on the neighborhood and quality of the unit. The housing market has been redlining for the past few years, so this release of pressure may prove to be a healthy byproduct of the virus, ahead of the news of a vaccine. At the risk of sounding optimistic, I believe the dip in rents is temporary. The San Francisco Bay Area attracts smart, ambitious and creative people who want to be in collaborative environments and tap the energy of the city. Once the urban amenities resume, so will the demand to live here.”