Presidio Bay Ventures has acquired a light industrial complex in San Carlos for $34 million that it intends to redevelop into a 410,000-square-foot life science campus, marking the developer’s largest bet on the sector in the Bay Area.
The San Francisco-based developer paid about $165 a foot for the land, a 4.7-acre parcel at 642 Quarry Road. It purchased the site from a family trust, according to a deed filed with the San Mateo County Clerk-Recorder’s Office on July 1.
The firm wants to demolish the site’s 83,500 square feet of existing buildings to make room for a pair of six-story life science structures and a nine-level parking garage, plans filed with the city of San Carlos last year show. The project, which the city is reviewing, is a 10-minute walk from a Caltrain station and is envisioned as a way to extend the nearby East Side Innovation District about a mile west to the San Carlos-Belmont border.
Presidio Bay bought the development site in an off-market deal, Cushman & Wakefield’s Ben Paul wrote in an email. Paul and Cushman colleague Gary Boitano represented the seller; they and Marc Pope are now the leasing brokers for the Quarry Road project. Presidio Bay, which represented itself, purchased the site in an all-cash deal, the firm’s K. Cyrus Sanandaji wrote in an email.
All of the complex’s tenants are on “very short-term” leases, Paul said, which makes it easier to redevelop once plans are approved. Vacancies within the complex are being marketed at $1.85 a square foot a month.
The property last traded in 1994 for an undisclosed price, title service records show. At least five retailers occupy its row of connected office and warehouse buildings, according to Google search results.
Space in Presidio Bay’s Quarry Road project will probably be a lot pricier to rent, assuming the city approves it: Asking rents for new lab project construction in San Mateo County, which includes San Carlos and 19 other cities and towns, is between $7.25 and $8.50 a square foot a month, Paul said.
The project is Presidio Bay’s second life science bet in San Carlos and its largest such play in the Bay Area. The firm broke ground in late May on a four-story, 147,000-square-foot office and lab building at 777 Industrial Road, about a mile and a half south of 642 Quarry Road. It not only expects to complete the Industrial Road development in the fourth quarter of 2023, but also anticipates having it at least partially leased to one or more tenants before it opens, Sanandaji said in an April interview.
Presidio Bay is targeting city approvals for its Quarry Road project by the end of this year so it can start construction by the second quarter of 2023, Sanandaji wrote in his email. The project will be one of the few, if not the only, construction site in northeast San Carlos for at least the next few years, after the city established a development moratorium for that part of the city in April that’s in effect until April 2024. It’s exempt from the moratorium because the city deemed Presidio Bay’s application complete before the freeze was enacted.
Besides the two projects in San Carlos, Presidio Bay’s development pipeline in the Bay Area includes apartments and commercial buildings in San Francisco and Menlo Park and a shopping center in Mountain View that the firm intends to redevelop into space for industrial, research and development and life science companies. Its entire portfolio comprises 31 projects in eight states, representing almost 4 million square feet valued at more than $3.3 billion, according to its website.
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