News

College Terrace Centre sold to new investor

Development has seen high turnover in grocery stores since 2017 opening

First Republic Bank is among the tenants at College Terrace Centre located at 2100 El Camino Real. Courtesy Blox Ventures.

College Terrace Centre, home to a new grocery store that opened Tuesday, Real Produce International Market, was sold to an unnamed "global investment company," according to a Wednesday press release from property owners Blox Ventures LLC and Angelo Gordon.

While the price tag of the sale was not disclosed, a report by the Silicon Valley Business Journal estimated that the property was purchased at more than $100 million.

Investment firms Blox Ventures and Angelo Gordon purchased the property for $78.5 million in June 2018, a year after construction was completed. Its previous owner was Greystone Property Development.

"The property was ripe for repositioning through re-tenanting with a solid anchor and bringing back a grocer — something the community both needed and wanted," Jason Oberman, CEO of Blox Ventures, said of the purchase at the time in an email. "When we identified the property, we recognized the assets of corner sitting, transportation access and proximity to both educational facilities and Silicon Valley businesses. Cosmetically, it had been neglected so we wanted to make a positive impact for the neighborhood aesthetic, as well."

With a new grocer now at the center, Oberman said his firm "felt it was time to dispose of the property in order to focus on (its) next project."

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Anchored by the First Republic Bank's regional office, the mixed-use property on 2100 El Camino is situated next to Stanford University and about a half-mile away from the California Avenue Caltrain station.

Despite its prime location, the 57,900 square-foot development has drawn scrutiny from local residents and city leaders for its inability to retain a viable grocery store — a requirement the City Council made in 2009 in exchange for favorable zoning changes.

When Blox Ventures purchased the property in 2018, it quickly faced a dilemma: fill a vacancy with a new grocery store or be hit with a $2,240 daily fine. Despite the challenges, Oberman said his firm was confident in the investment, given the tech industry and Stanford University's presence in the area.

"We never expect a project to be seamless, so we stayed focused on the positive outcome," Oberman said.

The first two grocers, Khoury's Market and College Terrace Market, have opened and closed since 2017, making Real Produce International Market the center's third. Owners of the previous markets cited issues with visibility for their stores, among other reasons, for leaving the property.

The center also includes eight below-market-rate housing units and a mix of local businesses.

Blox Ventures currently lists 530 Lytton Ave. in Palo Alto and 2100 Sand Hill Road in Menlo Park as its "current projects" on its website.

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College Terrace Centre sold to new investor

Development has seen high turnover in grocery stores since 2017 opening

by / Palo Alto Weekly

Uploaded: Thu, Dec 31, 2020, 10:08 am
Updated: Mon, Jan 4, 2021, 8:34 am

College Terrace Centre, home to a new grocery store that opened Tuesday, Real Produce International Market, was sold to an unnamed "global investment company," according to a Wednesday press release from property owners Blox Ventures LLC and Angelo Gordon.

While the price tag of the sale was not disclosed, a report by the Silicon Valley Business Journal estimated that the property was purchased at more than $100 million.

Investment firms Blox Ventures and Angelo Gordon purchased the property for $78.5 million in June 2018, a year after construction was completed. Its previous owner was Greystone Property Development.

"The property was ripe for repositioning through re-tenanting with a solid anchor and bringing back a grocer — something the community both needed and wanted," Jason Oberman, CEO of Blox Ventures, said of the purchase at the time in an email. "When we identified the property, we recognized the assets of corner sitting, transportation access and proximity to both educational facilities and Silicon Valley businesses. Cosmetically, it had been neglected so we wanted to make a positive impact for the neighborhood aesthetic, as well."

With a new grocer now at the center, Oberman said his firm "felt it was time to dispose of the property in order to focus on (its) next project."

Anchored by the First Republic Bank's regional office, the mixed-use property on 2100 El Camino is situated next to Stanford University and about a half-mile away from the California Avenue Caltrain station.

Despite its prime location, the 57,900 square-foot development has drawn scrutiny from local residents and city leaders for its inability to retain a viable grocery store — a requirement the City Council made in 2009 in exchange for favorable zoning changes.

When Blox Ventures purchased the property in 2018, it quickly faced a dilemma: fill a vacancy with a new grocery store or be hit with a $2,240 daily fine. Despite the challenges, Oberman said his firm was confident in the investment, given the tech industry and Stanford University's presence in the area.

"We never expect a project to be seamless, so we stayed focused on the positive outcome," Oberman said.

The first two grocers, Khoury's Market and College Terrace Market, have opened and closed since 2017, making Real Produce International Market the center's third. Owners of the previous markets cited issues with visibility for their stores, among other reasons, for leaving the property.

The center also includes eight below-market-rate housing units and a mix of local businesses.

Blox Ventures currently lists 530 Lytton Ave. in Palo Alto and 2100 Sand Hill Road in Menlo Park as its "current projects" on its website.

Comments

Online Name
Registered user
Embarcadero Oaks/Leland
on Jan 2, 2021 at 1:03 pm
Online Name, Embarcadero Oaks/Leland
Registered user
on Jan 2, 2021 at 1:03 pm

"The property was ripe for repositioning through re-tenanting with a solid anchor and bringing back a grocer — something the community both needed and wanted," Jason Oberman, CEO of Blox Ventures, said of the purchase at the time in an email. "When we identified the property, we recognized the assets of corner sitting, transportation access and proximity to both educational facilities and Silicon Valley businesses. Cosmetically, it had been neglected so we wanted to make a positive impact for the neighborhood aesthetic, as well."

Love the jargon. Now about that parking??


eileen
Registered user
College Terrace
on Jan 2, 2021 at 11:07 pm
eileen , College Terrace
Registered user
on Jan 2, 2021 at 11:07 pm

Oberman made sure that Khoury's Market, was pushed out, needed repairs were done, and visible signage for the NEW market was done before selling the property and making a sizable profit! Also, no fines were paid...


Longtime Resident
Registered user
Old Palo Alto
on Jan 3, 2021 at 2:51 pm
Longtime Resident, Old Palo Alto
Registered user
on Jan 3, 2021 at 2:51 pm

Sold to an unnamed "global investment company," - like one of the many EB-5 investor schemes which help people buy their way into the USA?


Online Name
Registered user
Embarcadero Oaks/Leland
on Jan 3, 2021 at 9:12 pm
Online Name, Embarcadero Oaks/Leland
Registered user
on Jan 3, 2021 at 9:12 pm

"Also, no fines were paid..."

Really?? Why not? I thought the city was so broke and cutting services and raising fees.


Anonymous
Registered user
Fairmeadow
on Jan 4, 2021 at 11:08 am
Anonymous, Fairmeadow
Registered user
on Jan 4, 2021 at 11:08 am

@Longtime Resident wrote:

"Sold to an unnamed "global investment company," - like one of the many EB-5 investor schemes which help people buy their way into the USA?"

One wonders how @Longtime Resident reached this conclusion and why he/she did not simply google and find out:

Web Link

Perhaps Palo Alto Weekly's reporter could have done the web search, too?


Cat Mom Leonorilda
Registered user
Midtown
on Jan 4, 2021 at 11:30 am
Cat Mom Leonorilda, Midtown
Registered user
on Jan 4, 2021 at 11:30 am

It would be "interesting" to know the origins and members of the international investment company"...


Anonymous
Registered user
Fairmeadow
on Jan 4, 2021 at 11:52 am
Anonymous, Fairmeadow
Registered user
on Jan 4, 2021 at 11:52 am

@Cat Mom Leonorilda: Follow the web link I posted above and you'll see that the property was bought by KKR:

Web Link


Name hidden
Downtown North

Registered user
on Jan 4, 2021 at 12:21 pm
Name hidden, Downtown North

Registered user
on Jan 4, 2021 at 12:21 pm

Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?


Chris
Registered user
University South
on Jan 4, 2021 at 12:45 pm
Chris, University South
Registered user
on Jan 4, 2021 at 12:45 pm

The owners made a return of more than 30% in 2 1/2 years. Not bad during a pandemic. Looks like the original developers left a lot of money on the table.


Palo Alto Resident
Registered user
Duveneck/St. Francis
on Jan 4, 2021 at 1:03 pm
Palo Alto Resident, Duveneck/St. Francis
Registered user
on Jan 4, 2021 at 1:03 pm

@Anonymous and others, this interesting ranking of the investment firm, by an outfit in Australia, may be of interest: Web Link


[email protected]
Registered user
Menlo Park
on Jan 8, 2021 at 10:24 am
[email protected], Menlo Park
Registered user
on Jan 8, 2021 at 10:24 am

The way I see this, Blox probably knows that the new mini-grocery store will fail, just like the two previous ones, and they are getting out now while they can make a sizeable profit. KKR will then inherit the headache of finding a 4th grocery store vs fighting with the city over the fines.

Signage was a problem before, and it still is a problem because First Republic has their sign in prominent locations (upper corner north & east sides) of the grocery store. Real Produce should have demanded their sign go up and First Republic taken down before they signed their lease.


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