Project Description

Overview: Calvano-Marwood Fund I LLC , a joint venture by Marwood and San Francisco-based Calvano Development Inc., acquired and is pre-developing four land parcels to ultimately build approximately 137,000 square feet of Class A office in Mountain View, California. These sites were all off-market and are strategically located in downtown Mountain View adjacent to the Caltrain Station and in the Shoreline submarket across from Google’s Worldwide HQ. The developable square feet is all available under existing “By Right” zoning.

The Sponsorship is of the strong belief in the investment thesis of capitalizing on the below market, under-utilized Mountain View office properties and employing a re-development strategy of the four existing Class B and C buildings into high-end Class A Office space. The overall project is viewed as one portfolio although each of the three projects will be run as independent LLCs and will be permitted and constructed on the City provides. This redevelopment strategy, post acquisition, involves immediately submitting to the City for “by-right” entitlements for each of the three development sites. Each individual asset’s business strategy is highlighted below:

747/701 W. Evelyn Street—Shortly after the Sponsorship acquired 701 Evelyn in July 2015, it closed on 747 Evelyn on 8/31/15. Both properties were zoned “by-right” at 4.0 FAR. A submittal for the two adjacent buildings will be put forward immediately to the City asking for the demolition of the existing structures, and the “by-right” entitlement for the construction of one Class-A office building of approximately 47,000 Square Feet.

278/280 Hope Street—Similar to the Evelyn site, this property (located two blocks away) had been zoned for a “by-right” 4.0 FAR and will pursue a similar strategy. A submittal for the two adjacent buildings will be put forward immediately to the City asking for the demolition of the existing structures, and the “by-right” entitlement for the construction of approximately 65,000 SF Class-A office building.

883 N. Shoreline Blvd—The land and improvements were acquired at a 4.42% cap with 100% occupancy. The plan will be to submit to the City for a 3-story, 26,000 SF Class-A office building. The sponsors plan will be to work with the tenants (primarily all month-to-month) in order to increase rents. At purchase, current rents were $3.00 under overall Mountain View asking rents and at least $1.50 under current sub-market rents. This plan will allow the yield to move closer to an 8% while entitlements are being pursued.

Type: Class A Office

Project Size: 24 land parcels for development of 137,869 sq. ft. of class A office

Purchased: August 2015

Recent news on Calmwater Capital, project’s lender: