Business & Real Estate

Office sales reflect confidence in local market

The December sale of the three-building Farmers Market complex in December was one of the year’s largest office deals.
The December sale of the three-building Farmers Market complex in December was one of the year’s largest office deals. bshallit@sacbee.com

Two end-of-year deals pushed local office sales to respectable levels in 2015, signaling a continued rebound for the region as a destination for big real estate investors.

The two deals – a $74 million purchase of the Farmers Market office complex in midtown and a roughly $30 million purchase of an as-yet-undisclosed building – brought the value of local deals to $374 million for the year, according to a report from the JLL brokerage firm that only tracks transactions valued at $10 million or more.

That was down from $470 million last year but well above the anemic sales levels during the recession from 2008 until 2013.

“It tells us that Sacramento is very much back on the radar screen for investors,” said Rob Cole, a JLL senior vice president.

His partner, Alan Stevenson, noted that interest in possible deals here actually intensified over 2014 and it was simply an “anomaly” that sales volumes didn’t surpass those of the previous year.

Both brokers predicted a jump in deals in 2016, with a number of big transactions now in the pipeline and likely to close in the coming months.

Driving the trend is an absence of good opportunities in overheated markets like San Francisco, along with a recognition that Sacramento is again a stable place to buy real estate, given increased state spending and growth in the private sector.

As a result, “it’s not just the opportunist guys wanting to come in, add value and then sell,” Cole said, “but buyers coming in and making longer-term decisions.”

Grocery site gets new tenant

A former Fresh & Easy grocery store in south Sacramento is getting a new use: It will become a dialysis center run by DaVita Kidney Care, a division of a Fortune 500 firm, sometime this year.

A DaVita spokesman said the clinic at 4401 Mack Road will be open six days a week with 24 stations. It could be operational by March but might not have Medicare certifications until later in the year.

City Councilman Larry Carr, who represents the area, said he is disappointed another grocery store isn’t going into the space that Fresh & Easy abandoned in 2013 when it opted to leave the Sacramento market. With the recent closure of a Raley’s on Mack Road, he said the district is at risk of becoming a “food desert.”

But he said he welcomes DaVita’s investment in the area along with the 25 jobs the clinic will create.

“Those are good jobs and (the service) is something that is really needed in the community as we age,” he said.

Havoc-wreaking elf

Sacramento’s Merlot Marketing had one of the more creative Christmas greetings this holiday season – and ended up getting national kudos for its work.

The agency developed a video for clients featuring new employee “Franc,” an Elf on the Shelf doll. The video shows Franc creating all sorts of mischief – deleting memos, sampling cookies laid out for Santa, using an office copier to produce elf selfies and drinking a bunch of the wine that Merlot staffers keep on hand for Friday afternoon soirées.

Agency CEO Debi Hammond said clients loved the video (see it at https://www.youtube.com/watch?v=_r5CUT_l9us) and staffers “had a ton of fun doing it.”

Adweek, the industry trade mag, also liked it, mentioning it in a story about the best agency cards and videos. Its story noted: “A drunken, mischievous Elf on the Shelf has invaded Merlot Marketing. In fact, this Elf is OFF the Shelf.”

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