Developer Signs Long Term Ground Lease to Convert Cost Plus Site to 168 Units
San Diego CA— Cushman & Wakefield announced on Thursday that Elisabeth Awes Separate Property Trust and the Williams Family Trust have come to terms on a long-term ground lease with developer 4th & J, LLC (Legacy Partners) for a prominent 30,056 square-foot (sf) parcel at 372 4th Ave. in San Diego’s Marina District. As the new lessee, 4th & J, LLC plans to redevelop the parcel into a $60 million six-story, 168-unit multifamily project.
The highly visible property situated at the corner of 4th Ave. and J St. currently consists of a 20,000 sf freestanding retail building formerly occupied by Cost Plus World Market that will be razed to make way for the new housing structure.
4th & J, LLC’s new 168-unit residential development—also commonly referred as 4th & J—will be mostly composed of micro studios, considered a trend-setting concept in San Diego along with one- and two-bedroom apartments. The project will also feature leasing and fitness centers, resident clubhouse including an internet café’, a swimming pool and spa for residents, two rooftop amenity decks, dog park, multiple fire pits, bbq’s, and wifi throughout, as well as 1,300 sf of ground floor retail.
Cushman & Wakefield’s Tim Winslow, Jason Kimmel and Kevin Nolen in the firm’s San Diego office represented Elisabeth Awes Separate Property Trust and Williams Family Trust in the transaction. According to the team, the deal reflects one of the first private-to-private development ground leases signed in 30 years in the 92101 zip code. The transaction from listing of the property to the loan closing took approximately five years to negotiate and complete. The owners of the property were interested in retaining this “A+” property for generations, rather than completing a 1031 exchange in a tight market.
Mr. Winslow, an Executive Director, said, “This is one the last under-developed parcels in the Marina Planned District, offering an A+ coastal location set within walking distance to several of San Diego’s marquee amenities, including the Gaslamp District, Petco Park, Seaport Village and the San Diego Convention Center. It is also desirably located within a stone’s throw of the marina and San Diego Bay/Pacific Ocean and is just a short drive from the San Diego Airport.”
He added, “The lessee’s plans to deliver this new influential residential project to the site looks to be a beneficial use change that will sync well with the composition of the Marina District and local area, creating walkable, high quality housing in this vibrant entertainment and business community.”