Ventas Snaps Up Bay Area Asset Slated for Conversion
A joint venture between Cannae Partners and REALM sold 4480 Willow Road, a 64,222-square-foot office and R&D building in Pleasanton, Calif. Ventas acquired the vacant property, according to public records. The REIT will convert the building into a medical outpatient facility.
JLL brokered the deal on behalf of the seller. The asset previously traded when Cannae and REALM acquired it in May 2022 for $13.5 million from Signature Homes, according to CommercialEdge data.
The single-story facility was vacant at that time, as well. Last year, Sutter Bay Medical Foundation, a subsidiary of Sutter Health, fully preleased the medical office redevelopment for 10.5 years. The entity also has a medical center less than 3 miles from 4480 Willow Road.
READ ALSO: Challenges Create Opportunities, Says MOB Investor
Initially completed in 1984, the new owner plans to finish the adaptive reuse next year. The property is set to feature a surgery center and provide orthopedics, gastroenterology, ophthalmology, urology and imaging services.
Located in a Bay Area suburb, the building is 37 miles from downtown San Francisco and 33 miles from downtown San Jose. Other medical providers in the area include Hacienda Lakes and Pacific Dental Care.
JLL Office Capital Markets Senior Directors Michael Manas and Erik Hanson, Managing Director Adam Lasoff and Senior Analyst Caroline Reynolds, along with the Healthcare Capital Markets team, led by Senior Managing Director Evan Kovac, represented the seller.
MOB sector poised to grow
The medical office building inventory is anticipated to increase by 10.6 percent over the next five years, according to a JLL report. Despite current economic uncertainty affecting commercial real estate, medical office continues to be fueled by positive long-term fundamentals, primarily by the aging population.
In the final quarter of last year, medical office construction activity recorded a notable decline, with new project starts representing only 0.8 percent of existing inventory—a record low. However, the absorption rate during the same period was considerably high, exceeding 19 million square feet in the top 100 U.S. markets, JLL research also shows.
The post Ventas Snaps Up Bay Area Asset Slated for Conversion appeared first on Commercial Property Executive.
