PENINSULA DEVELOPMENT ADVISORS

Real Estate Development Consulting

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Issue No. 77
 
Clients, Business Associates and Friends:
 
Happy New Year!!  Welcome to my December, 2018 email, containing selected updates on industry legislation, news and California projects and events from last month, geared towards public entities, brokers, landowners and developers.  I trust it will be of interest and use to all of you.  As usual, please let me know if you have any ideas or suggestions on how to improve this update, or items to add for future newsmails (or, if any of the links are broken).
 
It's good to see more MXD articles than I've seen in a while, although with the changes in retail, there always seems to be more than enough articles on retailers these days. 
 
Peninsula Development Advisors provides consulting services to both public and private clients on a contract basic.  Those services include governmental approvals, land acquisitions/dispositions, project management, lease negotiations, peer review, due diligence and retail tenant attraction.


Construction Cost Concerns Demand a Variety of Solutions.  A quick Bisnow article first on one of the largest issues in real estate development these days, rising construction costs.  It already seems as if the multifamily construction activity has slowed down to a crawl as a result of 10% to 12% per year increases.  Modular construction, building information modeling, new concrete types, cross-laminated timber, and direct material and labor contracting, are all mentioned as potential cost-saving areas.  See:  https://www.bisnow.com/silicon-valley/news/construction-development/construction-cost-concerns-demand-a-variety-of-solutions-95802?be=dean%40peninsuladev.com&email=dean%40peninsuladev.com&utm_source=MorningBrief&utm_medium=email&utm_campaign=20181213_los-angeles_morningbrief


Projects/Industry News

RETAIL

Fast Retailing Focuses on Online-Offline Integration at New Pilot Store.  The stores are only in Asia (so far), but the online/physical integration fascinated me.  The ability to create your own avatar that you can use to digitally try on clothing, for both sexes, together with the stores' own app, helps link the online and physical store experience.  And, you can pick-up the merchandise you order online at a local 7Eleven store??  See:  https://www.chainstoreage.com/daybreaker/fast-retailing-focuses-on-online-offline-integration-at-its-new-gu/

Competitive Ax-Throwing Facilities Spreading Rapidly in U.S. Cities.  Yes, really.  The concept started in Toronto as a location for an ax-throwing league, and then a separate venue in New Jersey opened in 2016.  Now the original operators, Urban Axes, has six locations open in the U.S., with more planned.  Expansion to the West Coasst is seen as the next move beyond their Texas and East Coast starts.  See:  https://www.bisnow.com/philadelphia/news/retail/ax-throwing-new-sport-retail-experience-urban-axes-95557?rt=65153&be=dean%40peninsuladev.com&email=dean%40peninsuladev.com&utm_source=MorningBrief&utm_medium=email&utm_campaign=20181204_san-francisco_morningbrief

RH Details Expansion Strategy, Other Developments for 2019.  RH has increased its planned new stores for 2019, to 5 to 7 new Gallery stores.  Future expansion in Europe, and its first hotel are also planned.  Different size ranges for stores are also on tap, from a 29,000SF to 33,000SF prototype to a smaller 10,000SF to 18,000SF store for smaller markets, as well as efforts to expand certain of their brands, their interior design business, and more stores in second home markets.  See:  https://www.chainstoreage.com/news/rh-details-expansion-strategy-other-developments-for-2019/

Talbot's Toyland Uses Tech from Pointy to Reach Customers.  Good story of my local (or, only) toy store, and how they are expanding their reach through tech, allowing them to accurately keep track of inventory and help get more exposure in online search inquiries.  See:  https://www.sfgate.com/business/article/Talbot-s-Toyland-uses-tech-from-Pointy-to-reach-13445372.php

Downtown L.A.'s Latest Retail Renaissance?  Broadway's Burgeoning 'Sneaker Row'.  Jumpman LA is the latest shoe-related retailer on South Broadway's so-called "Sneaker Way".  The store has an onsite customization center, a VR Mars simulator, physiology and metabolic testing machines, a TV lounge and a rooftop basketball court.  The store joins a WSS outlet, Sheikh Shoes, and a Footaction store (from Footlocker) with a Nike Kicks Lounge, with a new Vans store coming in 2019.  This area is only one of the market areas that are attracting shoe retailers in LA.  See:   https://www.latimes.com/business/la-fi-sneaker-row-20181208-story.html

Armstrong Development to Build 240,000 SF Shopping Center in Roseville, California


ROSEVILLE, CALIF. — Armstrong Development has announced plans for Campus Oaks Town Center, a shopping center located at the corner of Blue Oaks Boulevard and Roseville Parkway in Roseville. The Roseville City Council recently unanimously approved the project.  Construction for the 240,000-square-foot property is slated to begin in spring 2019, with delivery scheduled for summer 2020.  Nugget Markets and 24 Hour Fitness will anchor the property, which is approximately 66 percent leased to date and expected to be 85 percent leased by the start of construction. Additional tenants will include The Learning Experience, MOD Pizza, Posh Nail Salon, Fresh Cleaners, Jasmine Mongolian BBQ, Supercuts and Ben’s Barketplace.  Western Real Estate Business, December 13, 2019.

Dollar General Plans Nearly 1,000 New Stores Next Year, Including More Produce Offerings.  The numbers are stunning, but then they have been for a few years now:  975 new stores planned for 2019, even with Dollar General staying away from Walmart store locations.  The move to grocery offerings seems like a natural trend for them.  To those that don't know, they do have 3 existing stores in the Bay Area among a great number of California stores and over 15,000 in the country.  See:  https://www.bisnow.com/national/news/retail/dollar-general-plans-nearly-1000-new-stores-next-fy-including-more-food-offerings-95724?be=dean%40peninsuladev.com&email=dean%40peninsuladev.com&utm_source=MorningBrief&utm_medium=email&utm_campaign=20181210_san-francisco_morningbrief

Aldi, Panera Bread Part of Proposed Hesperia Shopping Center.   A 54,346SF shopping center is going through the approval process in the City of Hesperia, to be anchored by a 22,000SF ALDI grocery store, the city's second.  The existing ALDI store was built last year.  No mention of the name of the development entity.  See:  https://www.vvdailypress.com/news/20181216/aldi-panera-bread-part-of-proposed-hesperia-shopping-center

U.K. Toy Retailer Has Eyes on U.S.  Hamley's, the British chain that is the owner of the largest toy store in the world in London, will be opening in New York City soon, as a part of a planned U.S. expansion that was originally put on hold after a false start in 2015.  With no more Toys R Us, seems like the right time.  See:  https://www.chainstoreage.com/real-estate/u-k-toy-retailer-has-eyes-on-u-s/

MIXED-USE

Anaheim Ducks Owner Will Develop Entertainment, Retail Centers Around Honda Center After Striking Deal With City.  Henry Samueli, the Chairman of the Board of Broadcom, extended the Anaheim Duck's lease at the Honda Center in Anaheim, and at the same time, agreed to purchase 16 acres from the City to build either a retail or mixed-use project.  Samueli will also build a 3,900-space parking structure as a part of the deal, and take over the responsibility for the operating and capital expenses for the arena.  See:  https://www.bisnow.com/orange-county/news/commercial-real-estate/ducks-will-develop-around-honda-center-after-striking-deal-with-anaheim-95527?be=dean%40peninsuladev.com&email=dean%40peninsuladev.com&utm_source=MorningBrief&utm_medium=email&utm_campaign=20181204_los-angeles_morningbrief

Navarra Properties’ Multi-Phase SuperBlock@I.D.E.A. District in San Diego’s East Village is Well Underway.  Phase 2 of this 2.75-acre redevelopment has begun;  the conversion of two warehouses to 100,000SF of creative office space, aimed at major tech tenants.  A 450,000SF 17-story office building will be phase 3.  Phase 1, a 24,000SF retail building has already been completed.   The presence of a large population of millennials andproximity to UC San Diego are touted as selling points to tech firms.  See:  http://www.rentv.com/content/homepage/mainnews/news/24668

City of Concord Moves a Step Closer Towards its 30-Year Execution of the Navel Weapons Station Plan.  13,000 housing units, 6.1MSF of commercial, industrial and office space, and 2.3MSF of higher education and institutional space will eventually be built on about half of the 5,000-acre former Navy base, but the initial 500 acres is poised to betransferred to the City for development.  Lennar and Five Point Communities are leading the effort for the City, and are anticipated to be the developers for that first 500-acre phase. in addition to Lennar being the master developer for the entire 2,300-acre project (the remainder being withheld for open space and parks).  See:  https://news.theregistrysf.com/city-of-concord-moves-a-step-closer-toward-its-30-year-execution-of-the-naval-weapons-station-plan/

Genton Cockrum Partners Selected for Mixed-Use Project at Former Courthouse in San Pedro.  The West Hollywood-based developers were selected by the County of Los Angeles in an RFP process for the 1.8 acre site, after the original RFP recipient's deal was terminated.  The plan includes apartments and retail, including a grocery store to be named.  See:  http://labusinessjournal.com/news/2018/dec/12/genton-cockrum-partners-selected-mixed-use-project/

OMA-Designed Santa Monica Development Takes a Step Forward.  Metropolitan Pacific Capital and Clarett West Development plan a mixed-use project in Santa Monica that will include a 280-room hotel, 106,800SF of office space and 42,000SF of ground floor retail in tiered buildings up to 12-stories in height.  Parks, open space, a specialty market and a museum are also planned to be in the development.  The project has not yet been approved by the City.  See:  https://urbanize.la/post/oma-designed-santa-monica-development-takes-step-forward

The Westside Evolves with Full Slate of Mixed-Use Developments.  A report from the Connect Westside Los Angeles event in November, which included a mixed-use panel that listed 4 planned projects in the Westside.  Corridors such as Abbot Kinney in Venice, 3rd Street Promenade in Santa Monica, Culver Steps and Culver Studios in Culver City, were discussed by the panel.  See:  https://www.connect.media/the-westside-evolves-with-full-slate-of-mixed-use-developments/?utm_source=mlCalifornia&utm_campaign=mlCalifornia-2018-12-07_18:01-Yardi_Matrix_Reports_Cooling_Multifamily_Market_No_Cause_for_Alarm&utm_medium=email&utm_term=news%20los-angeles%20development%20mixed-use%20office%20retail&utm_content=Yardi_Matrix_Reports_Cooling_Multifamily_Market_No_Cause_for_Alarm&pid=3cd3a12d-d006-4bcd-a30d-fc79b216d5ef

Google's plans for development of a 3.12 million-square-foot mixed-use campus in Mountain View, CA were revealed in documents filed with the City last week.  The vision encompasses new and redeveloped offices, up to 400,000 square feet of community retail space, and up to 8,000 new homes, along with 35 acres of publicly accessible space.  Google's Mountain View development director Michael Tymoff told CNBC, "We also want to see the area transformed into what the City calls 'Complete Neighborhoods,' with a focus on increasing housing options and creating great public places that prioritize people over cars."  The North Bayshore project will entail partnering with a developer to build up to 6,600 residential units, including 20% percent of it affordable housing.  The plans will go under City review next year.  See:  https://www.mountainview.gov/depts/comdev/planning/activeprojects/northbayshore_/nbppbonusfar.asp


OFFICE

New Owner and New Look for Proposed Culver City Office Development.  Lincoln Property Company and Broad Street Principal Investments have purchased the 3.7 acre proposed Entrada office development site in Culver City adjacent to the DoubleTree Hotel.  The property is currently a parking lot.  The two companies plan an 11-story, 280,000SF office building designed as creative space for media or tech firms.    See:  https://urbanize.la/post/new-owner-and-new-look-proposed-culver-city-office-development

EVENTS

 

Women in Focus MeetUp:  The Tale of Inspiring Women.  January 10, 2018, Gensler office in Oakland.  Hear from a developer, a former mayor and an activist:  Deb Boyer of the Swig Company, Kristina Lawson of Hanson Bridgett and Sonya Trauss of California Renters Legal Advocacy & Education Fund.  See:  https://news.theregistrysf.com/event/women-in-focus-meetup-the-tale-of-inspiring-women/?utm_source=The+Registry+Database&utm_campaign=c1ecb38991-EVENT_Elevate_2_2_2_2016_COPY_01&utm_medium=email&utm_term=0_efa1d9206e-c1ecb38991-78919357


Connect Retail West.  January 22, 2019, at the Resort at Pelican Hill, Newport Coast.  A full-day event with panels entitled "It Starts with Service", "The Future of Malls", "Up, Up and Up?  Investment Sales in 2019 and Beyond", and "Ladies Who Lead".  Speakers (including Keynote) to be announced.  See:  https://connectconferences.com/retailwest2019/?utm_source=mlConferenceNews&utm_campaign=mlConferenceNews-2018-12-27_21:00-Announcing_Connect_Retail_West_January_22&utm_medium=email&utm_term=&utm_content=Announcing_Connect_Retail_West_January_22&pid=3cd3a12d-d006-4bcd-a30d-fc79b216d5ef

InterFace The Inland Empire Commercial Real Estate Conference.  January 23, 2019 in the City of Moreno Valley Confrence Center.  With e-commerce using industrial space, retail developers having to reinvent their centers, and Multifamily growing daily the Inland Empire is one of the most active markets throughout S. California.  The big event will include those who are buying, selling, developing, redeveloping, leasing or financing  (Retail, Industrial and Multifamily) properties in the Inland Empire. The conference will explore the latest trends in leasing, management and operations, as well as economic and demographic trends that impact these three dynamic sectors.  See:  http://interfaceconferencegroup.com/event/interface-the-inland-empire-commercial-real-estate/

RENTV's Orange County State of the Market Conference.  January 24, 2019 at the Hilton Irvine/Orange County Airport.  The usual panel discussions on industrial , office, retail and multifamily, with 15 speakers/panelists committed to date.  See:  http://events.r20.constantcontact.com/register/event?oeidk=a07efv2ncyadd7e7b16&llr=fzkplkcab&showPage=true

City of San Jose Opportunity Zone Symposium.  February 4, 2019, San Jose City Hall.  Includes a guidance update from Michael Novogradac, an overview of San Jose's zones, operating business investments and real estate development in Opportunity Zones, including:  how Silicon Valley stacks up for Opportunity Fund investment nationwide; which types of real estate are best primed for San Jose Opportunity Zone projects; renovation vs. ground-up development: what the guidance suggests; affordable housing in Opportunity Zones; equitable growth: How can development benefit existing residents and communities; how cities should prepare;  and what we still don’t know. See:  https://www.eventbrite.com/e/san-jose-opportunity-zone-symposium-tickets-53740722949?aff=SJOZones

Opportunity Zones 101:  San Francisco, South Bay and the Peninsula.  February 6, 2019,  at the Hotel Nikko, San Francisco.  WHAT YOU'LL LEARN:  1. What are Opportunity Zones and what is a Qualified Opportunity Fund?  2. What are the benefits of investing in Opportunity Zones and how does OZ investing work?  3. How do developers and investors expect their projects to spur economic development in San Francisco?  4. Of the real estate tracts designated as Opportunity Zones by Governor Jerry Brown, which are most ripe for investment and what makes them more desirable (and possibly profitable) than the others?  5. What are the tax benefits of the tiered structure of the program?  Eleven speakers set for two panels on +Opportunity Zones 101" and "OZ Tracts in San Francisco".  See:  https://www.bisnow.com/san-francisco/events/opportunity-zones/Opportunity-Zones-101-San-Francisco-South-Bay-The-Peninsula-2341


The 5th Annual Entertainment Experience Evolution.  February 12-13, 2019 at the Beverly Wilshire Hotel in Beverly Hills.  The physical environment for retail is changing around the evolving wants and needs of today's consumers. As the consumer changes to be more focused on time, money and experience, environments for retail and dining are adapting to their wants and needs. EEE is the conference that has continually pushed the envelope for retail, offering attendees access to keynote speakers who address this change head-on, retail real estate owners who are confronting the changing environment with amazing results.  Omnichannel retailing is at the forefront of today's consumer. The retail environment remains the place for brands to be seen and consumers to spend leisure time. Entertainment venues, food tenants and smart retailers know that time spent in a built environment is about experience.How do you find the market, assist retailers and restaurants and give consumers great places to spend time?  See:  http://www.cvent.com/events/2019-entertainment-experience-evolution/event-summary-a2cace2cd92e415b868c6c6f84a838b6.aspx

Silicon Valley State of the Market and Opportunity Zones.  February 20, 2019, venue to be announced.  WHAT YOU'LL LEARN:  1. What effect – positive or otherwise – will Google’s new campus and employee population have on the city of San Jose? 2. What geographic areas have been designated viable for Opportunity Zone development?  3. What are the most notable developments – from hotels to office space, airport renovations and TOD – under construction across the market and what commonalities do they all share?  4. Does the “boom” San Jose is experiencing signal that a “bust” is too follow or can the growth across sector be sustained? 5. What initiatives are underway by the city, developers, and nonprofits to combat the housing crisis and increase the supply of affordable housing units on the market? Speakers include Sam Liccardo (San Jose Mayor - keynote), Leslye Corsiglia (SV at Home), Nathan Donato-Weinstein (City of San Jose Business Development Officer), Michael Van Every (Republic Urban Properties), and Samantha Hauser (City Ventures). See:  https://www.bisnow.com/silicon-valley/events/neighborhood/Silicon-Valley-State-of-the-Market-and-Opportunity-Zones-2344

InterFace Net Lease West.  March 5, 2018, at the Omni Hotel, Los Angeles.  France Media's InterFace Conference Group, Western Real Estate Business, Shopping Center Business and California Centers are pleased to announce that the eighth annual InterFace Net Lease West, an information and networking conference for the net lease, sale leaseback and 1031 markets in the Western United States, will take place March 5th at the Omni Los Angeles Hotel at California Plaza.  Over 175+ attendees are expected at what will be the first major NNN conference of the year, and the only industry event held on the West Coast. InterFace Net Lease West will bring together leading West Coast dealmakers as well as national firms active in the Western United States and is produced by the same team behind the industry-leading InterFace Net Lease national conference held every September in New York City.  The InterFace Net Lease West agenda will cover investment, development and financing trends and discuss market conditions in the NNN and sale leaseback space. The event will take place the afternoon of March 5th and conclude with a post-conference networking cocktail reception.  See:  https://web.cvent.com/event/58cae494-6061-4fcf-8a46-087907bddad0/websitePage:daa6d2c6-f6ff-465c-8c83-b88b1867c85b

Interface San Diego Retail Conference.  March 19, 2019.  Western Real Estate Business, Shopping Center Business, California Centers and the InterFace Conference Group are pleased to announce the Annual InterFace San Diego Retail Real Estate conference which will take place on March 19th. This conference will discuss the changing retail environment, activity at the Port of San Diego and its effect on San Diego Retail. Hear from the most active retail players from the San Diego area on how they see retail growth and opportunities. Plus learn who is leasing, building, buying, selling and financing San Diego.  This event will attract attendees from throughout the San Diego market and surrounding states, including developers, investors, brokers, tenant representatives and retailers. If you are interested in or active in the San Diego retail real estate market, you should plan to attend.   See:  https://web.cvent.com/event/4a771068-6b12-4c84-8ebb-eba7f814cc4d/websitePage:daa6d2c6-f6ff-465c-8c83-b88b1867c85b?previewToken=073fed9f60bf2d8e93b0c3c95700f799




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