East bay shopping center for sale

Real Estate Alert, April 28, 2004

A local developer is marketing an upscale shopping center near Oakland that's expected to Fetch at least $70 million.

The 154,000-square-foot Plaza Escuela occupies a full city block in downtown Walnut Creek, about 20 miles northeast of the Bay Bridge. It's likely to attract interest from institutional investors, wealthy individuals and retail operators. At the expected price, the buyer's initial annual yield would be slightly below 7%. BT Commercial has the listing.

Plaza Escuela is 95% occupied. It is anchored by Andronico's grocery store, Container Store and Men's Wearhouse. Most of the tenants have five- to 10-year leases with rents that are about 25% below market rates. The two-year-old property, owned by Blake Hunt Ventures of Danville, Calif., is located within a retail district catering to affluent pedestrian shoppers.

Over the past 15 years, Walnut Creek has grown from a small, residential town into a popular shopping hub. The transformation started in the mid-1980s, when Macerich Co. purchased and renovated a 700,000-sf open-air mall called Broadway Plaza, bringing in Nordstrom as an anchor. The move triggered a series of improvements among local retail venues that eventually attracted high-cad tenants--including Restoration Hardware, Williams-Sonoma and Tiffany & Co.--that occupy open-air, "Main Street-style" venues.

For information on Plaza Escuela, call BT's Dan Wald at 415-781-8100.