Office Property Likely to Give Way to Multifamily

FREMONT, CA—Further demonstrating the critical need for housing in the Bay Area, one property may eventually go from 100% occupied office building to a 100% occupied multifamily complex. The sale of Parkway Center, a two-story 71,742-square-foot office building, may pave the way for a potential redevelopment to multifamily, say sources close to the transaction. The buyer was The Stanley Group Inc. of Los Gatos, which purchased the asset for an undisclosed price.

Parkway Center is a multi-tenant office building, with tenants that include Lipman Insurance Administrators, Coldwell Banker, Chicago Title and The Center of Speech. Located at 3340 Walnut Ave., the property is in close proximity to the Fremont BART station and surrounded by numerous retail amenities.

NKF Capital Markets vice chairman Steve Golubchik and director Tim Walling represented the seller, Bayside Realty, in the transaction, as well as the buyer.

“Parkway Center offered a great opportunity for an investor to increase NOI by bringing the current tenants to market rents to take advantage of dwindling office supply. Given that Parkway Center is part of a multifamily zoning overlay, it is a prime candidate to be redeveloped in the coming years,” said Walling.

Despite the 100% occupancy of the building, the development will most certainly not be of an office nature due to housing demand and its location.

“It will be developed to multifamily, given the rising multifamily rental rates and lack of supply,” Walling tells GlobeSt.com.

For now, The Stanley Group is enthusiastic about adding the strong-performing property to its portfolio.

“Parkway Center’s location is second to none. Its close proximity to Fremont’s new city hall and civic areas along with walking distance to BART make Parkway an ideal asset for us to own and manage,” says Russel Stanley, president of The Stanley Group.