North Palisade Partners, a development and investment firm focused on industrial, industrial outdoor storage (IOS), and self-storage properties, acquired a nearly 8-acre site at 4125 Breakwater Ave. in Hayward, CA for $19.7 million. The 100-percent leased property is a value-add IOS facility located at the base of the San Mateo-Hayward Bridge (92 Freeway). 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.
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 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 and Jay Hagglund of Cushman & Wakefield represented the unnamed seller in the transaction. The property is currently occupied by United Rentals, SSS Transport, Outfront Media, American Tower, and Crown Castle.
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 its near adjacency to the Peninsula via the San Mateo-Hayward Bridge and Hayward offers a significant value proposition compared to the Peninsula.”