The report by the Irvine, Calif.-based firm shows the Santa Rosa-Petaluma Metropolitan Statistical Area as the 18^th most profitable market for those who buy, renovate and resell homes, part of a list of the 25 markets where the practice generated the highest rate of return in 2012.

Brian Burke

Yet Brian Burke, managing director of the Santa Rosa-based real estate private equity investment fund Praxis Capital, cautioned against labeling the area or any other as a hub for that activity.

“It’s very deal specific — it’s hard to generalize,” said Mr. Burke, whose company specializes in real estate investments that include flipping homes. “What that tells me is not that Santa Rosa is the best place to buy homes because you can buy at a deep discount. Houses in Santa Rosa have appreciated faster than homes in other areas.”

A “flipped” home in Santa Rosa generated an average gross profit of 19 percent, or $53,558, according to the report. There were an estimated 527 such sales over the year, with an average original purchase price for the home of $285,344. The number of single family homes involved in the practice had increased 47 percent from the year before.

The city was the least profitable of other Bay Area markets that made it to the list. Flipped homes in San Francisco and San Jose generated an average return of 23 percent.

The most profitable market on the list was Orlando, Fla., where a home purchased at an average price of $103,701 generated an average profit of 63 percent upon resale, according to RealtyTrac.

Climbing home prices have attracted an array of investors in the current market, with “flipping” being among those practices. RealtyTrac estimated the sales that involved a flip by counting transactions that occurred within six months or less of a previous sale of the same home. The firm looked at 600 metro areas for the report.

The practice has changed from the days when buyers could purchase a distressed property at a deep discount and sell at a profit after basic renovations, Mr. Burke said. While investors were able to put between $10,000 and $30,000 into a property for a profitable sale while the market was at its low, those activities now entail from $30,000 up to as much as $250,000, he said.

“Now the business has shifted to looking for properties that may need another bedroom, or even a full rebuild of a home,” he said. “It’s basically the homebuilding of this decade. It used to be you buy a property and build 20 homes on it — that was real estate development.”

Investors, which account for the majority of absentee buyers, purchased 24.2 percent of all homes across the Bay Area in April, according to San Diego-based real estate data tracker DataQuick. That number was up from 23.5 percent in April 2012, with investors paying a median of $362,000 across the Bay Area region.

With multiple private placement funds involving single-family homes, “flipped” homes and multifamily properties in Texas, Praxis has grown to $25 million under management in four years, Mr. Burke said. Those funds have generated an average 20 percent annualized return for investors, but it is the stability of the funds that has proven attractive in a volatile investment climate, he said.

Median home prices in Sonoma County were up 23.5 percent in April versus the same month in 2012, at $376,000, according to DataQuick. The number of sales, 611, was also up 15.3 percent, while the number of sales Bay Area-wide notched down 0.6 percent.

Median prices continued to climb outside of Sonoma County as well, with approximately half of that due to price appreciation and half due to a greater number of higher-priced homes in the sales mix, according to DataQuick. Distressed sales are also on the decline, accounting for 24 percent of sales versus 44 percent across the Bay Area one year ago.

In Marin County, a median price of $799,000 was 29.3 percent greater than one year ago, with 345 homes sales representing an 18.2 percent increase. Napa County saw an April median of $385,000, up 21.3 percent, and a 13.3 percent increase in homes sales, at 136. There were 1.3 percent more homes sold in Solano County, at 564, and the median price of $238,000 was up 36 percent from April 2012.

Bay Area-wide, median prices rose above $500,000 for the first time since almost five years. Prices first passed that threshold in May of 2004, and continued rising for four years before dropping below $500,000 in June 2008. Median prices for homes sold across the Bay Area reached a low of $290,000 in March 2009.

Bill Facendini

With fewer distressed properties in the mix, larger investors are now looking towards higher-end homes and income properties, said Bill Facendini, president of Terra Firm Global Partners. More of their investor clients are holding on to their current properties, particularly those that are generating rental income, he said.

Meanwhile, the period of flipping distressed properties has left a positive mark on many neighborhoods, he said.

“It has been good for communities. I’ve seen some communities that had started to slide, but then these people come in and refresh some of these distressed homes. People are having pride of ownership again,” he said.

Article source: http://www.northbaybusinessjournal.com/73472/santa-rosa-ranked-one-of-most-profitable-flip-markets/

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Investcorp managing director Herb Myers
calls the acquisition ?a unique opportunity to
generate solid income returns while also
advancing leasing and operating income
over a longer time horizon.?

SAN FRANCISCO-The US-based real estate arm of Investcorp, a multinational provider and manager of alternative investment products, has paid $65 million for a portfolio of mixed-use commercial real estate properties in the Northern San Francisco Bay area—an area consistently ranked by institutional real estate investors as one of the top areas for investment within the US. The deal represents the largest transaction closed in the North Bay area so far this year and, according to the company, and demonstrates the firm’s continued selectivity and focus on high-yielding assets.

The predominantly class-A portfolio comprises 14 buildings, including a mix of office, industrial and retail properties concentrated in Petaluma and totaling 840,637 square feet, with properties currently occupied by a diverse group of tenants. In acquiring the portfolio, Investcorp ventured with PBJ Acquisitions, a San Francisco-based real estate owner and operator. Together, the companies will seek to increase the net operating income of the properties by leasing the currently vacant space and by renewing existing tenants.

“This acquisition of a diverse group of class-A properties presents a unique opportunity to generate solid income returns while also advancing leasing and operating income over a longer time horizon,” says Herb Myers, a managing director in Investcorp’s real estate team. “The multi-assets nature of this portfolio should also enable us to pursue, opportunistically, a number of value-creating options.” Myers could not be reached by GlobeSt.com before deadline to elaborate on the options mentioned, the seller, financing details of the purchase, the age of the properties involved or the company’s long-term plans for the portfolio.

The location of this investment builds on an established Investcorp focus on properties in close proximity to major US markets, but in submarkets where secure investments at attractive valuations are easier to find. In line with this strategy, Investcorp closed two Greater-L.A.-area transactions in 2011: the Park Tower office complex in Long Beach and the Residence Inn Manhattan Beach. These were complemented by additional transactions in Princeton, NJ, and in the corridor between West Palm Beach and Ft. Lauderdale, FL.

Categories:

West,
Industrial,
Office,
Retail,
Acquisitions/Dispositions,
San Francisco

Carrie Rossenfeld Carrie Rossenfeld is a reporter for the West Coast region of GlobeSt.com and Real Estate Forum. She was a trade-magazine and newsletter editor in New York City for 11 years before moving to Southern California in 1997 to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics ranging from intellectual-property licensing and giftware to commercial real estate. She recently edited a book about profiting from distressed real estate in a down market and has ghostwritten a book about starting a home-based business.

Article source: http://www.globest.com/news/12_307/sanfrancisco/acquisitions_dispositions/Investcorp-Acquires-Mixed-Use-Portfolio-for-65M-319616.html

Bahrain-based Investcorp, a leading provider and manager of alternative investment products, has acquired a portfolio of mixed-use commercial real estate properties in the Northern San Francisco Bay Area in the US.

In the largest transaction closed in the North Bay area so far this year, Investcorp’s US-based real estate arm acquired the properties for approximately $65 million, said a statement.

The predominately Class A portfolio comprises 14 buildings, including a mix of office, industrial, and retail properties concentrated in Petaluma, also known as Telecom Valley, totaling 840,637 sq ft. 

In acquiring the portfolio, Investcorp ventured with PBJ Acquisitions, a San Francisco-based real estate owner and operator. Together Investcorp and PBJ will seek to increase the net operating income of the properties by leasing the currently vacant space and by renewing existing tenants.

Mohammed Al Shroogi, Investcorp’s president for Gulf Business, said: “Investcorp Real Estate has over 16 years of experience and has completed transactions totaling over $10 billion. In the last 12 months alone, Investcorp has deployed more than $200 million of capital in US real estate including two other acquisitions in the greater Los Angeles area.” – TradeArabia News Service

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Article source: http://www.tradearabia.com/news/newsdetails.asp?Sn=REAL&artid=214083

San Francisco, CA (PRWEB) October 07, 2011

The Sonoma Valley real estate three former Santa Rosa and Petaluma offices of Pacific Union have merged with the Wine Country Group by Better Homes and Gardens Real Estate. The merger of these highly experienced and qualified real estate firms brings a new level of service to real estate clients in San Francisco, Berkeley and the Sonoma Valley.

Owned by Coralee Barkela and Suzanne Drace since 2006, the San Francisco real estate Pacific Union offices in Santa Rosa and Petaluma have a total of 37 agents. Ms. Barkela will remain with the company as a top producing agent, and Ms. Drace will remain as the branch manager of both offices.

“Six months ago, Wine Country Group was formed in order to give buyers and sellers a high end choice,” says Dougan Jones, managing partner. “Wine Country Group has quietly and steadily attracted top agents to better serve our clients.”

Since February of this year, Wine Country Group has grown to 11 offices and 219 real estate agents. Seven offices and 180 agents were added to the company when Frank Howard Allen Sebastopol was merged with the Wine Country Group by Better Homes and Gardens Real Estate in June. The company’s network now consists of 40 offices and 2,000 real estate agents throughout Northern California and Northern Nevada.

The Wine Country Group’s offices are in Santa Rosa, Petaluma, Sonoma, Healdsburg, Sebastopol, Cloverdale, Bodega Bay, Glen Ellen, Napa and St. Helena. The firm expects to continue to grow its footprint in other Sonoma and Napa County market areas.

For further information about San Francisco, Berkeley and Sonoma real estate agents, contact Cathy Harrington at 925-525-0946 or winecountrygroup.com.

About Better Homes and Gardens Mason-McDuffie Real Estate

The company’s heritage began with the founding of Mason-McDuffie Real Estate in 1887. In 2009, the company was named the 19th largest real estate services firm in the nation, and tops in the San Francisco East Bay. The company provides comprehensive solutions to home buyers and sellers, and handled more than 7,300 transactions in 2010, generating $2.9 billion in sales. Better Homes and Gardens Mason-McDuffie Real Estate is independently owned and operated and includes joint ventures with partners J F Finnegan Realtors, Highland Partners in Piedmont and Montclair, Wine Country Group Realtors in the North Bay, and Tri-Valley Realty in Pleasanton-Hopyard and Ruby Hill. The organization is comprised of more than 2,000 sales professionals in 40 offices.

###

For the original version on PRWeb visit: www.prweb.com/releases/prwebreal-estate/sonoma-valley/prweb8860079.htm

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/10/07/prweb8860079.DTL

OnTrac leased this entire 50,000-square-foot south Petaluma building for expansion.

As part of a ramp up of Bay Area service, Phoenix, Ariz.-based regional overnight package courier OnTrac is expanding its North Bay hub. The company in August leased the entire former 50,000-square-foot Scandinavian Designs distribution center at 3830 Cypress Drive in Petaluma. From one loading dock in 9,000 square feet at 374 Blodgett St. in Cotati, OnTrac will have seven dock doors and two grade-level doors, allowing the company to handle 60 percent more packages for its service area, nearly 400 miles of coastline from San Francisco to Oregon, according to Laura Peterson, marketing vice president.

Founded 20 years ago as California Overnight and focusing on moving escrow and other documents for professional services firms, OnTrac now serves various industries in seven Western states, adding Colorado in September, and has annual revenues of more than $200 million. The service doesn’t deliver wine, according to Ms. Peterson.

OnTrac markets itself as a faster, less-expensive alternative to national couriers. The company has California hubs in Sacramento, San Jose, San Francisco and a new one in Menlo Park. The largest facility is a new 160,000-square-foot hub in Reno, Nev.

OnTrac currently has 15 employees plus independent contractor drivers at the North Bay hub and will be hiring five sorters (resumes: HRMail@OnTrac.com) as well as more drivers (vendorrelations@OnTrac.com) for the Petaluma facility.

Jerry Angel of Cornish Carey Commercial Newmark Knight Frank and Rick Keefer of Pacific Union International represented the building owner. John Kovaleski of Colliers International represented OnTrac.

In the past three months, a number of offers from expanding North Bay companies came in on the building, but most were looking for up to 30,000 square feet, according to Mr. Keefer.

***

The Marin County Board of Supervisors on Tuesday could postpone until Nov. 15 a decision for the county to purchase part of a large San Rafael commercial property to be the new home for the Sheriff’s Department and other emergency services currently located at the Civic Center to the south in San Rafael. On Sept. 13 the board postponed the decision until Oct. 4 to give staff more time to study the venture.

If the board decides to move forward with such a purchase, the supervisors will be considering whether to purchase the entire 328,000-square-foot office building at 1600 Los Gamos Drive in the Marin Commons two-building development for $30 million or 165,000 square feet of it for $24 million, as part of the purchase option agreement with owner CORAC LLC from earlier this year.

If the board chooses the partial purchase, CORAC would pursue a lot split, according to board documents. In studying the plan, county has released $100,000 of the $250,000 deposit since the April agreement was signed.

Should any sale move forward, escrow could close in 45 days, per the agreement, unless the either side of the deal decides to extend it for 90 days, according to David Spear, facilities planning and development manager. How much of the space county offices will occupy depends on forthcoming space planning and accommodating existing tenants in the building, he said.

Marin Commons has been a big piece of the the county’s office vacancy rate for years, even before the current owner took it back in a 2009 foreclosure.

“A county deal at Marin Commons would absorb a big chunk of space,” said Whitney Strotz, head of Cassidy Turley BT Commercial‘s San Rafael office.

***

Fairfield-based developer, owner and property manager The Wiseman Co. acquired the 30,000-square-foot class A Westside Professional Building at 2480 Hilborn Road and an adjacent pad. It’s the only zoned and approved office building site on the west side of Interstate 80, according to the company.

The building had been taken back by Sterling Savings Bank when the previous owner was unable to find enough tenants, according to Doyle Wiseman, chief executive officer. Current tenants on the ground floor are Fidelity Title Co., Richard Whittaker‘s law firm, and publicly traded Vitas Innovative Hospice Care.

“The price was severely depressed because of the previous owner’s inability to lease the property and the bank’s urgent need to sell,” he said.

Without disclosing the actual amount, he said the property was acquired for less than half the $10 million-plus assessed value of the property.

Wiseman brokers are in talks with an undisclosed company to occupy the second floor.

***

Groskopf Warehouse Logistics found a large Napa Valley warehouse for its expansion. [See "Wine warehouser Groskopf plans expansion," Aug. 15.] The Sonoma-based company signed a three-year lease with Upvalley Associates LLC for 60,000 square feet at 801 Hanna Ct. in American Canyon with first right of refusal on the whole 101,000-square-foot former Western Wine Cellars warehouse, according to Groskopf’s agents, Kevin Doran and John Rico of Keegan Coppin. Bret DeMartini of Grubb Ellis represented Upvalley in the Aug. 28 deal.

***

Steve and Judy Mahrt, owners of Petaluma Farms, which produces Judy’s Family Farms organic eggs, are back to buying Petaluma office buildings and converting them back to industrial buildings for business expansion, according to local real estate sources.

In the first half of this year, the Mahrts purchased the 15,616-square-foot former Creative Leisure office building at 951 Transport with plans to convert it to egg distribution warehousing with a possible retail aspect. [See the May 31 commercial real estate column.]

On Aug. 9 Mahrt Family 2008 Trust purchased the former home of First California Mortgage Co., nearly 19,000-square-foot 939 Transport Way, from the Bergmann Family Trust for $1.375 million, or about $74 a square foot. Chris Castellucci of Keegan Coppin represented the Bergmann family in the sale. Mr. Mahrt was not available for comment.

•••

Submit items for this column to jquackenbush@busjrnl.com or call 707-521-4256.

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Topics: County of Marin, Fairfield, industrial real estate, investment real estate, Marin Commons, Marin County, Napa County, office real estate, OnTrac, Petaluma, Petaluma Farms, San Rafael, Solano County, Sonoma County, The Wiseman Co. | Categories: Commercial Real Estate, Industry News, Position, Top News Stories

Article source: http://www.northbaybusinessjournal.com/41293/commercial-real-estate-ontrac-makes-big-north-bay-courier-hub-expansion/