By Keith Loria, Contributing Writer
San Francisco—Trumark Urban, a recently created division of Trumark Companies, has acquired a six-site portfolio in San Francisco, to build mid- and high-rise condominium communities of more than 500 units in the city’s urban core.
“Trumark has worked for 25 years to develop underutilized property in urban infill locations throughout the Bay Area. We specialize on the entitlement and design effort, at determining and achieving higher and better uses for land,” Arden Hearing, Trumark Urban’s managing director, tells MHN. “These efforts are the most rewarding in supply constrained markets, of which San Francisco is the epitome.”
The company plans to invest more than $300 million in the project, with sites located in Lower Nob Hill, South of Market, Hayes Valley/Mid-Market, Potrero Hill, the Inner Mission and The Marina.
“We have always believed that the right time to enter new markets or market segments is early in a real estate cycle,” Hearing says. “That is not always easy to discern, but it appeared to us in 2011 that we were at a unique entry point for San Francisco.”
While the area has seen an increase in rental housing of late, Trumark believes there is an exploding demand in for-sale housing in core urban areas because of the lack of supply.
“Aside from the cycle timing, we see a paradigm shift in consumers towards the city, towards urban living, across generations. This is being compounded by the move-down nature of the baby boomers and the ‘move-in’ focus of the millennial,” Hearing says. “Technology startups, for example, no longer flock to Silicon Valley. San Francisco, near BART and art galleries, is where these workers need to be today—where they demand to be. We want to provide housing for these urban dwellers who consider city living to be an integral part of a full life experience.”
The company is focusing its efforts on unique projects in unique neighborhoods throughout San Francisco. The six sites were chosen for their transit access, walkability to restaurants and shopping, local appeal, individuality and potential for bringing dramatic improvement to the surrounding area.
“For one in particular, that means a high-end 2,500-square-foot multi-level condo living over $2.5 million. In another case, we have sub-500-square-foot one-bedroom condos with no parking at BART and walkable to Twitter and other technology companies,” Hearing says. “In short, we are not forcing our brand or lifestyle on anyone. We are working to listen and meeting the needs of the district in which we are working.”
In Nob Hill, for example, Hearing envisions turning a dilapidated auto repair shop into a high-rise condominium community with commercial/retail on the ground floor and perhaps a public-private art gallery in the alley.
The first project is expected to break ground in May and by the end of 2013, the company will have more than 1,000 units in its San Francisco pipeline.
Trumark Urban is an offshoot of Trumark Homes, which has raised more than $140 million in equity for single-family residences in suburban areas.