Radius Group Completes Largest Office Building Sale in Santa Barbara History
Radius Group Commercial Real Estate is pleased to announce the sale of one of downtown Santa Barbara’s largest and most prominent office buildings, 820 State Street. Paul Gamberdella of Radius Group’s Tuler / Gamberdella Team represented both buyer and seller in the transaction. Additionally, Ed DeLacy of CB Richard Ellis represented both buyer and seller and Roger Willmon of the Willmon Group, co-represented the buyer with Gamberdella and DeLacy.
Although terms of the sale can not be disclosed, according to Paul Gamberdella of Radius Group, “This transaction represents the largest office building ever sold in Santa Barbara and the highest purchase price ever paid for a Santa Barbara office building.”
The 64,979 square foot office building adjoining the historic “El Paseo,” was originally constructed in the mid 1960s by the Suski family. The “Suski Building,” as it was once known, but more recently referred to as the “El Paseo Building,” has been a prominent landmark in the downtown office and retail scene. Although Mr. Gamberdella was not at liberty to disclose the names of the buyer or the seller, Mr. Gamberdella did verify that the sellers are descendants of the Suski family.
The El Paseo Building was designed in the 1960’s by famed local architect Lutah Maria Riggs, an architect who worked with George Washington Smith first as his chief designer, and later as his partner. Together, they are credited with creating the Spanish-style architecture and image of Santa Barbara. Smith and Riggs designed many of Santa Barbara’s landmarks including the Santa Barbara News-Press Building and the Lobero Theatre.
According to Gamberdella, the sale of 820 State Street was the culmination of years of work between Gamberdella, DeLacy and the sellers of the property.
“We were hired by the sellers to provide guidance on the building renovation and represent the sellers in the leasing of 820 State Street,” said Gamberdella. “During that time, the El Paseo Building experienced a major renovation and repositioning within the downtown market making it one of the most highly sought after locations for larger office and retail tenants in the downtown market.”
The renovation included: expansion of store-front windows fronting State Street, a creating new retail entrance / facade off State Street, the addition of windows on the 2nd floor facing Canon Perdido Street, seismic retrofitting, new electrical, new mechanical systems and new interior build outs specific to each new tenant’s needs.
The building was 100% leased at the time of the sale. Current tenants in the building include 24-Hour Fitness, Anchor Blue and five office tenants located on the 3rd, 4th and 5th floors. All tenants will continue to lease their current spaces.
“Once the building was close to being fully leased, we began to receive inquiries from parties interested in purchasing the property. Initially, the seller had no interest in pursuing a sale but timing is everything. This sale was due in large part to the right buyer asking the right questions at the right time,” said Gamberdella.
“The decision to sell was not something that happened overnight. There was a great deal of analysis, education and thought that went into the seller’s decision to sell the property and to the buyer’s credit, they were understanding, patient and cooperative throughout the process,” Gamberdella continued.
In terms of what was gained by both the buyer and the seller, Gamberdella suggests, “The seller was able sell the property at a time when the value of downtown commercial property is at an all time high. The buyer added one of Santa Barbara’s most prominent commercial properties to its commercial real estate holdings and due to the building’s irreplaceable qualities, the location will continue to be a highly sought after place for office and retail tenants to do business in the downtown corridor.”
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Summary of market insights and analysis from Q2 2019 South Coast commercial sales and leasing activity: Download the complete report here …