Palo Alto retail building fetches $10M

Sand Hill Properties to find new tenant for 15K sf property

Sand Hill Property's Peter Pau and Susanna Pau with 281 University Ave
Sand Hill Property's Peter Pau and Susanna Pau with 281 University Ave (Loopnet, Sand Hill Property)

A local investor has paid $10 million for a renovated building in Downtown Palo Alto occupied by an outgoing Restoration Hardware store.

Peter Pau, founder of Sand Hill Property based in Palo Alto, bought the 15,000-square-foot building at 281 University Avenue in Downtown North, the Silicon Valley Business Journal reported. The deal came out to $667 per square foot.

The sellers, a group headed by an unidentified local family trust, tried to sell the building for as much as $14 million.

Restoration Hardware, which spent between $3 million and $5 million to renovate the building, is expected to relocate this year to a flagship store at the nearby Stanford Shopping Center, according to a broker who arranged the deal.

The single-story building at Bryant Street includes 7,500 square feet of ground-floor retail and 7,500 square feet of basement.

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Pau and Sand Hill Property are betting on a retail recovery with plans to find a new tenant for the building.

Sand Hill Property, a real estate development and investment firm founded in 1988, has invested in more than 65 projects totaling 20 million square feet in Silicon Valley, from stand-alone retail stores to multi-use city centers, according to its website.

It expects to break ground soon on a $4 billion redevelopment of a former mall in Cupertino, where it plans to build a retail village of 2,400 homes, half of them affordable, with nearly 2 million square feet of offices, labs, shops and restaurants.

Sand Hill is also working to redevelop a shopping center in southwest San Jose into a 167,000-square-foot, mixed-use project with nearly 1,000 apartments, of which 150 would be affordable.

Dana Bartholomew

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