BPG Investment Partnership VIII and VIII A L.P. (Fund VIII) this week announced it paid $169.5 million for a nine-building mixed-use property in San Jose, Calif., which it plans to renovate extensively.
Sold by a partnership between Divco West and RREEF, the 600,000-square-foot Park Center Plaza occupies nearly an entire city block in the central business district. It is comprised of approximately 538,000 square feet of mid- and high-rise office space and approximately 62,000 square feet of restaurant and retail space, and includes a 1,074 space parking garage.
“This transaction provided us with the opportunity to acquire a well located mixed-use property below replacement cost in a market that has been experiencing improved occupancy and rental rates,” said Andrew White, senior vice president of BPG who together with Gardner Ellner, associate, was responsible for overseeing the transaction. “BPG is committed to acquiring and redeveloping well located properties throughout the Western United States as part of our overall strategy for Fund VIII.”
BPG will be executing an extensive $10 million capital improvement program to update and improve on-site amenities, including the addition of a fitness facility, additional on-site restaurants and a new conference center. Other improvements will include renovations of common areas, including lobbies, entrances, restrooms and upgrades to the plaza area.
At the time of sale, the property was 74 percent leased.