On the Horizon
Jan 13, 2017 02:17PM ● Published by Cale Finta
EAST BAY HOSPITALITY MARKET HEATS UP
Developers Circle City-Owned Site for New Hotel
Across the Bay Area, new hotel projects are starting to emerge as occupancy and room rates increase, driven by the Bay Area’s rise as a tourism and business destination. Emeryville opened its first hotel in decades in 2016 and a 16-story, 334-room hotel at 2129 Shattuck Avenue in Berkeley seems to be moving forward. But while San Francisco and the Peninsula have seen a flood of proposals, the East Bay pipeline has remained relatively small. Until now.
Tharaldson plans to build a three-story, 127-room Hilton Garden Inn at the Lawrence Way site with ample parking. Once the deal is finalized, the hotel could be completed within 24 months. City officials hope the project will trigger more redevelopment in the surrounding area and diversify the city’s revenue sources. A staff report estimates an average of $520,000 in Transient Occupancy Tax (TOT) a year—the 8% levied on overnight guests—from the completed hotel.
Over 75 percent of Walnut Creek’s general tax revenues are derived from only two sources: property taxes and sales taxes. Hotels present the city an opportunity for tax revenue diversification with lower impacts to services and traffic.
OTHER HOTEL PROJECTS
A 6-story, 160-room MARRIOTT RESIDENCE INN near the Walnut Creek BART Station at 2050 and 2047 N. Main Street is under construction.
Align Real Estate hopes to develop the former McDonald’s site on California Boulevard into an APARTMENT HOTEL featuring 77 apartment units and 20 fully furnished studios for overnight or extended stay guests.
According to a city report, 238,000 square-feet of retail and 1,500 residential units are currently underway in the downtown area.
It’s a renaissance in Walnut Creek. Not only are plush apartments, new hotels and an array of shops and restaurants opening all over town, but a food hall, rivaling San Francisco’s Ferry Building and Napa’s Oxbow Market, is on the city’s development table. The brainchild of BH Development’s Brian Hirahara, who brought Va de Vi, Tiffany & Co, Apple, Sasa and the restaurants at 1500 Mt. Diablo to Walnut Creek, THE FOUNDRY is expected to take East Bay foodie culture to the next level.
What started in Great Britain, the food hall concept is a return to urban markets of the past— now spreading across America—an eclectic mix of fast-casual, food truck and street food-style concepts along with entertainment in one large venue. A general plan amendment, conditional use permit for reduced parking and other approvals are being requested by BH Development. The firm is acquiring the city-owned land at 1250 Locust Street for $4.1 million to develop The Foundry.
After years of negotiations, redevelopment of the ROSSMOOR SHOPPING CENTER in south Walnut Creek is moving forward. Highlights of the 15-acre project include: a new CVS Pharmacy with drive-up service, a new 2,000-square-foot Starbucks with drive-up service, bocce ball courts, a burger joint, plus a new anchor tenant such as a hardware store. Safeway stays with a new long-term lease. Construction, which has been delayed, is anticipated to begin this year and last twelve months.
After a rash of delays, the new a pet-friendly residential community on California, Bonanza and Locust streets called LYRIC WALNUT CREEK is expected to open this spring. The multi-use development includes one and two bedroom apartments on the top, a large public plaza, ample tenant and visitor parking below, and an enviable downtown location. Word on ground floor retailers, other than Bank of the West and Dry Bar, has been scarce.
Just across the street from Lyric, MOMO’S is opening in the former McCovey’s location featuring a bossy brunch menu with bottomless mimosas and Benedicts. Small plates, burgers, rock shrimp scampi and crispy calamari round out the California cuisine style menu.
Festive and familial, GOTT’S ROADSIDE is a big draw for Walnut Creek. Famous for juicy burgers, ahi poke tacos and thick milkshakes, foodies travel for miles to eat at their iconic St. Helena and Ferry Building locations. A first look at renderings for the makeover of the former Fresh Choice include outdoor dining. Last we heard, opening sometime in 2017.
Millennials are turning up the heat in America's hottest housing markets, says a new report from realtor.com®. Ranked number two on the national list in 2016 is PLEASANT HILL, CALIFORNIA (94523). Realtor.com® is a leading online real estate destination operated by News Corp [NASDAQ: NWS, NWSA]; [ASX: NWS, NWSLV] subsidiary Move, Inc. Other zip codes that topped the list: 76148 (Watauga, Texas); 80233 (Northglenn, Colo.); 80916 (Colorado Springs, Colo.); 78247 (San Antonio); 94954 (Petaluma, Calif.); 02176 (Melrose, Mass.); 63126 (Crestwood, Mo.); 97222 (Milwaukie, Ore.) and 92104 (North Park, Calif.) a town in San Diego.
Millennials—18 to 35 year olds—are the largest generation in U.S. history. They represent substantial buying power and greater share of the population in most of the top 10 hottest zips. Although first time buyers usually have more limited incomes than other buyers, millennials in these areas are more likely to earn in excess of six figures. In the top 10 hottest markets, the share of millennials earning more than $100,000 is 1.8 times higher than the U.S. overall.
In Pleasant Hill, the dominant buying group is 35 to 44 year olds, which make up 31 percent of buyers, but millennials are a close second holding 26 percent of mortgages. Forty-two percent of millennials in this area make over $100,000, which is two times the norm for millennials in the U.S. Homes in Pleasant Hill sell in under 30 days with a median list price of $630,000, up almost 4 percent for the year.