Publication: The Registry
Date: February 13, 2014
Mill Valley-based Thompson Dorfman Partners has turned a big profit on the sale of the 0.75-acre site located at 2655 Bush Street in San Francisco.
The real estate company and its financial partner, New York City-based Ares Management has sold the site for $38 million or $469,000 per unit, according to sources familiar with the transaction. The sellers had owned the property since August of 2012 when they bought the foreclosed property for $14.5 million.
The buyer of the asset was Los Angeles-based KB Home. The firm in its Northern California office in Pleasanton declined to comment by the deadline for this story. The development will include 81 condos and some retail space. In the past the site had been a convalescent home.
“When we first bought the property we had no real intention of selling the site. We thought that this property had a good location and could be used for either condos or apartments,” says Bruce Dorfman, a principal with Thompson Dorfman.
This company was then contacted by Brett Betzler of Moran & Company. “I asked Dorfman if he ever thought about selling the site. He said that if you could find a buyer maybe we would be interested. I was the person who brought in KB Home into the deal,” says Betzler, a director with Moran, who based in the company’s Irvine headquarters. He spends much of his time working on deals in Northern California.
The lower Pacific Heights is a very attractive site for a residential development. “There are several major employers in the area. This includes UCSF and Kaiser Permanente. I would think that both of them would have employees that would be interested in the project. I think that the walk-ability of this location is off the charts,” said Dorfman.
Betzler thinks that 2655 Bush Street project will be coming in a good time for the condo market in San Francisco. “The condo market now is in a good spot as far as demand versus supply. This project will be on the early end of new condo projects being started in San Francisco. I don’t think that anyone really knows how long this situation will last,” has said.
Polaris Pacific, a San Francisco-based sales and marketing firm that tracks the San Francisco market, stated in its January 2014 report that the city has remaining inventory of 2.2 months. This figure is used to indicate the speed of absorption of current supply in months. Six months is considered a balanced market, and nine months or more means the market is oversupplied.
Polaris Pacific calculates that in San Francisco there are 2,185 new condo units under construction at the moment.