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8/24/23
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North Palisade Partners acquired a nearly eight-acre site in the East Bay for $19.7 mil. The 100%-leased property, located at 4125 Breakwater Ave in Hayward, is a value-add IOS facility located at the base of the San Mateo-Hayward Bridge (92 Fwy). It contains two structures totaling 32k sf of space.
The acquisition adds an asset with in-place income to the company’s portfolio and offers a potential future redevelopment opportunity for a higher-and-better use. The property is currently occupied by United Rentals, SSS Transport, Outfront Media, American Tower, and Crown Castle.
John Petersen, Partner of Los Angeles-based North Palisade Partners, said, “The San Francisco Bay Area is appealing as an industrial investment target for us, primarily because it remains a tight infill market on the West Coast with elevated barriers-to-entry. The region is nearly fully built out, entitlements are difficult to secure and there are geographic constraints that surround the densely populated region, which has created a supply and demand imbalance.”
This well-located site is a roughly 15-minute drive across the Bay to Foster City on the San Francisco Peninsula and is positioned at the midpoint between the primary industrial markets of Oakland and Fremont along the I-880 corridor, both of which are within a 20-minute drive of the site.
Dick Scott of Scott Ventures I Inc represented the buyer. Jay Hagglund of Cushman & Wakefield repped the unnamed seller in the transaction.
Petersen added, “As investors, our investment strategy is centered on unlocking long term asset value. There are fewer and fewer parcels of Bay Area land for industrial development, which only heightens the scarcity factor. From our viewpoint when you look 5, 10, 15, or even 20 years down the road, we believe Bay Area industrial real estate will provide a higher risk-adjusted return on a relative basis due to these factors. We are particularly attracted to Hayward because of its near adjacency to the Peninsula via the San Mateo-Hayward Bridge and Hayward, which offers a significant value proposition compared to the Peninsula.”
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