GRID Magazine - Autumn 2021

Background: A well-lit corner of the Light.wav Art Show in a warehouse on R Street.

S ACR A MEN T O COMMERCIA L RE A L E S TAT E, DE V ELOPMEN T, A ND CULT URE

06 ISSUE NINE

Everything you need to know about cannabis!

14

Do you really need a broker? We say maybe!

33

How does affordable housing make money?

TURTON

WRIT TEN, PHOTOGR APHED, AND DESIGNED IN-HOUSE BY THE TURTON TE AM

FALL 2021

Randy Paragary 1946 - 2021

A lot of people like to talk about doing things.

A few people actually do them.

A FEW WORDS FROM

KEN TURTON

KEN TURTON - PRESIDENT

PRESIDENT

KEN TURTON

Lic. 01219637

916.573.3300 | kenturton@turtoncom.com

VICE PRESIDENT

VICE PRESIDENT

SENIOR DIRECTOR

DIRECTOR

AARON MARCHAND

Lic. 01711650

916.573.3305 | aaronmarchand@turtoncom.com

JON LANG Esq.

Lic. 01934934

916.573.3302 | jonlang@turtoncom.com

SCOTT KINGSTON

Lic. 01485640

916.573.3309 | scottkingston@turtoncom.com

PATRICK STELMACH

Lic. 01964999

BROKERAGE

VICE PRESIDENT

916.573.3314 | patrickstelmach@turtoncom.com

DAVID KHEDRY

Lic. 02063469

916.573.3303 | davidkhedry@turtoncom.com

DIRECTOR

MATT AXFORD

Lic. 02124801

916.573.3308 | mattaxford@turtoncom.com

DIRECTOR

JACK SCURFIELD

Lic. 02127988

916.573.3316 | jackscurfield@turtoncom.com VP PROP. / PROJECT MGMT. VP OPERATIONS & MARKETING CREATIVE DIRECTOR

MARKETING ASSOCIATE

MELODY JONES

Lic. 01296376

916.496.1527 | melodyjones@turtoncom.com

BROOKE BUTLER

Lic. 02086576

916.573.3301 | brookebutler@turtoncom.com

COREY LAU 916.573.3304 | coreylau@turtoncom.com

JUSTINE WONG

M A R K E T I N G / O P E R AT I O N S

Gates’ Law states, “Most people overestimate what they can do in one year and underestimate what they can do in 10 years.”

After the latest weekly episode of “Commercial Real Estate in a Pandemic,” I decided to stop by LowBrau for a well-deserved adult beverage.

To 99.9% of the thousands that patronize LowBrau, most think it takes about two minutes to prepare a drink. But when Mike Heller or Aaron Marchand or Michael Hargis or Ken Turton enjoy a drink at LowBrau, we know it took a lot longer than two minutes to get that drink in our hand.

Heller bought 1050 20th Street back in 2004 (yep... from yours truly… in my early 30’s lol). Back then it was primarily a storage warehouse for the State of California. Back then it didn’t have the beautiful decking or fancy angular retail storefronts we have become so accustomed to seeing today. In 2004, what you see today was just a dream. A dream almost every developer in town said was crazy. Not enough parking! No traffic counts!

It won’t work! Every developer in town except Mike Heller. It took about thirty months to finish the structure thousands who enjoy today. And it seemed like every month had a different challenge. Even after it was complete there were struggles. Finding the right retail tenant mix. Leasing office floors on the second floor that didn’t divide easily. Finding creative ways to solve problems like public restrooms and ADA access to the deck.

Then came the “Great Recession” between 2008 - 2012.

It was around 2012 when Marchand ran across a potential beer/bar/ restaurant tenant with a concept they felt was ideally suited for the MARRS (Midtown Arts Retail Restaurant Scene) Building. Corner anchor tenants are most significant for urban retail buildings like MARRS and the first restaurant located on the corner of 20th and K Street was a highend, small plate restaurant call Lounge on 20. The food was good, but it was not an ideal fit for the Midtown demographic and the cultural direction of Sacramento’s urban core.

Fast forward nine years and the success of LowBrau not only set the tone for a robust retail center of MARRS but set the cultural tone for Midtown’s culinary evolution for the next decade.

Today, at Turton Commercial, there are very few places we eat or drink at in Midtown and even Downtown that doesn’t have a similar story that goes back 5 – 20 years and we have been fortunate to play a small but integral role in the creation of much of it.

Our team continues to work on transformative transactions. It will take another 2 – 5 years for those visions to become reality. So, when we stop to enjoy an adult beverage at one of our client’s restaurants, we never think it only took a few minutes to prepare that drink. We know it took much longer than that. And we appreciate the years of difficulty, commitment and passion from all parties involved to make it happen.

916.573.3304 | justinewong@turtoncom.com

OUR SERVICES

CONTACT US

Landlord Representation

2131 Capitol Ave, Ste 100

Tenant Representation

Sacramento, CA 95816

Buyer/Seller Representation

916.573.3300

Building Valuations

TURTONCOM.COM

Property & Project Mgmt.

Instagram: @turtoncre

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Fun for the whole family - yes, even grandma and grandpa!

ISSUE 9 F A L L 2 0 21

I S S U E 9 | FA L L 2 0 2 1

CONTENTS Consume regularly for best results!

SINCE LAST ISSUE...

14

When You Don’t Need a Broker

17

Analysis of Veggie Burgers

19

Timeline of a Good Deal

21

Grid-Adjacent Neighborhoods

27

Midtown Thrift Shops

29

Our Involvement in Sac’s Evolution

33

Affordable Housing = $$$?

34

Project Homekey’s Potential

39

A Chat with Kevin Khasigian QUESTIONABLE RELEVANCE

Midtown Bar Crawls

“ME” TIME

13

TRADITIONS

Hierarchy of Office Needs

Days of vacation Ken’s taken: 28 Employees with Covid-19: 0 Dozens of donuts brought in by Scott: 14

NEW IDEAS

10

WHOLESOME FUN

My Love for Mid-Mods

THE HUMAN MIND

09

SECRET SAUCE

Cannabis FAQ

THE ELEPHANT IN THE ROOM

06

Net gain of team members: -2 Signs graffitied with “TurDon”: 12 New words invented: 12

ENDANGERED SPECIES

The Work Model Shake-up

POTENTIALLY-LAME JOKES

05

HVAC complaints: 20+ New office couches: 1 Arguments over new couch: 6

CONSOLIDATED INFORMATION

New listing high of: 171 Perished office plants: 0 Employees hit by a car: 1

ECONOMIC PROJECTIONS

k for!

Didn't as

SUGGESTIONS

Stats yo u

Top: A huge, vibrant mural painted by Shaun Burner and Franceska Gamez on the side of Market 5-ONE-5 on R Street.

Left: Bonus points if you can name where this Midtown mural by @zhermano is!

S ’ R E W O R G RICT T S I D The

he se

gt Plantin

cramen

a nge in S a h c f o s ed

trict

er Dis v i R s ’ o t

ART STUDIOS BREWERIES RESTAURANTS RESIDENTIAL AND MORE FOR LEASE

SCAN FOR MORE INFO

SUBLEASE & SAVE Scan for Properties:

TURTON

OFF THE RACK SACRAMENTO’S OFFICE SUBLEASE MARKETPL ACE

T URTO N CO M .CO M / SUBL E A SE

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Not another anti-W FH propaganda piece by some cor porate pro - office shill! - That’s a Turton Promise® MATT AXFORD

ISSUE 9

- DIRECTOR

F A L L 2 0 21

NAVIGATING THE

WORK MODEL SHAKE-UP If there’s one question I hear from clients the most, it’s “do you get all your clothes tailored?” followed by “when is everyone coming back into the office?” The truth is, some people may never be back fulltime - but many will. Here are some of the less-pondered implications of it all!

Over this past year, many dreamt that we’d all work remotely from now on. Instead of leaving home, we’d be sleeping in an extra 15, using our own bathrooms, and covertly sipping champagne in a coffee mug during Zoom meetings – so the fantasy went.

But not every office team is willing or able to switch to this model. In fact, right now, companies are all over the place (literally, in some cases). While a large portion of the workforce continues to enjoy the luxuries of the home office, some still find comfort in an in-person environment. And of course, many have adopted the beloved “hybrid” schedule.

I’d wager most teams have at least one member - if not the whole office - working from home a few days a week. And that’s great! But, to be the endlessly skeptical person I am, what are the implications of all these different work models? For instance, will the boss be more likely to invite me to happy hour if I’m there on the same days? Can I af-

Feel like your opinions aren’t heard when calling in? Try this screen-on-a-womannequin life-hack to assert your presence.

ford to finance my own workday coffee habits? Is having a job worth not seeing my dog for eight hours? There’s a lot to consider. Working from home offers huge quality-of-life advantages that can’t be denied, but can also result in quality-of-work disadvantages.

So, which direction should you go?

Consult our carefully curated index of implications below so you can make a more informed decision!

THE EXPECTED

Full-time in the Office

lit

Hybrid or Sp

Even more data from last issue!

POST-PANDEMIC, WHAT DO YOU PREFER?

Home

Combo

25% 52% 23%

In-office

n=1,040

Full-time ome work-from-h

And now, some data from last issue!

ARE YOU MORE PRODUCTIVE AT HOME? Sort of

Yes

68%

22% 10%

n=1,040

No

THE NOT-SO-OBVIOUS

Theoretically increased productivity for collaborative roles.

More face time with team mates strengthens friendships and increases enjoyment of working together.

Industrial strength Wi-Fi! Commuting.

Having to see “that guy” in-person.

Potentially better ability to focus.

Can be a nice reprieve from home life.

Likely enjoyment of lunches and happy hours with coworkers.

Employees may expect compensation if other offices are allowing WFH. Some may leave the company if not given a remote option.

Strong work-life balance.

Less of your life spent commuting.

Can do chores and cook in between work tasks.

Higher potential for disjointed communication and missing work.

Those required to still be in full-time might feel it’s unfair.

Improved staff loyalty by means of feeling empowered to get their work done on their time.

Hiring managers can cast wider nets.

Hypothetically less sick day usage.

Harder for natural leaders to emerge.

Those who are in the same days as the boss have a career advantage.

Your own private bathroom (3-ply!!)

Even less time spent commuting.

Employees can live further from work.

Hard for collaborative and sales roles.

Having to pay for your own coffee, snacks, and air conditioning.

Being surrounded by tons of distractions begging you to stop working.

Your dog / cat / goldfish will be thrilled!

Possible company-funded home office furniture, electronics, and internet.

Your packages will finally stop getting stolen from the front porch.

Lack of demarcation between work and home life can cause stress.

Hard to welcome and train new hires.

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Can or can’t- abis? That is the question.

ISSUE 9

COREY LAU - CREATIVE DIRECTOR

Will the area turn sketchy after a shop or grow facility moves in?

Almost positively, no. The combination of increased foot traffic, on-site security, and (commonly) rules against loitering can actually improve a struggling area. Stroll past Cookies on J Street or A Therapeutic Alternative on H Street and see for yourself!

Do any businesses allow on-site consumption of it?

Not as of now. Legislation will be required to allow that and it will be big news. But you can hop over to SF or LA to get a preview of some groovy cannabis lounges which will hopefully be allowed in Sac soon.

F A L L 2 0 21

What are the main differences between County and City rules regarding cannabis businesses?

Trick question! Sacramento County doesn’t allow ANY commercial cannabis operations - only the City of Sacramento does. No word on if the County will change course.

{FAQ}

A question for our office!

WHEN DID YOU LAST USE POT? Never Long ago Last month Yesterday

n=12 2

4

6

8

CANNABIS

Where are cannabis-related businesses allowed to operate?

Within City limits, 600 feet away from schools and parks, and one of the following zones: C2 C4

M1 M1S

M2 M2S

MIP MRD

Do landlords of buildings with cannabis tenants need special insurance?

Until a few years ago, landlords couldn’t get liability insurance for their buildings with cannabis tenants due to it’s Federal Schedule I label. Now, numerous options exist for the industry - even crop insurance for the tenant!

What are the common operations of a cannabis business?

Ahh, a nice broad question! This is a huge industry which involves people who grow it, transport it, refine it into different products, put oil into cartridges, and package it for sale. For our purposes, “cannabis business” means anywhere the material physically passes through from growth to sale. Interestingly, current laws prohibit a business from being involved in all parts of the product’s life cycle to prevent vertical integration and supposedly organized crime.

Aspiring growers and dispensary operators celebrate the legalization of cannabis but often complain about the weirdly complex and confusing-to-navigate regulatory process.

Worry not! We’re here to help with answers to some of the most-asked questions we get about the business.

“Mmm cookies” is what you will be saying after a visit to Midtown’s new dispensary on J Street.

What permits are needed to open a cannabis business / facility?

Following finding an approved location, you’ll need a Conditional Use Permit for cannabis from the City. These are limited in number, complicated, and highly competitive, but more permits are released each year. After this, you’ll need a Certificate of Occupancy specific to the cannabis activities you plan to do.

Words from an expert!

Joseph Moser Cannabis Consultant

The biggest mistake I see made is business permit applicants under-estimating the complexity and time required to complete and submit a winning package. It’s highly recommended that you get advice from an industry expert.

Will other tenants in a building get high because of the mere presence of the weed tenant?

Only if they’re lucky.

What’s it like being high on a cannabis product?

For most people? Euphoric, silly, psychedelic chillout. For some?

Anxious, overthinky panic attack.

I thought it was called marijuana.

What are all these other names?

Modern names include: Cannabis (genus name), Pot, Weed, Loud, Wacky Tobaccy, Jazz Cabbage, Giggle Bush, Jamaican Tomatoes, Reverend Green, Left-Handed Cigarette, The Devil’s Lettuce, Satan’s Salad, Beelzebub’s Broccoli, Aristotle’s Arugula, + many more!

What special infrastructure is required for a cannabis tenant?

For growers and manufacturers, an industrial space with high power capabilities, strong ventilation, and building security is key. These businesses can be fairly compact, believe it or not - check out this small indoor farm we listed a while ago!

As for cannabis dispensaries, requirements are more operational but certain physical buildouts make it easier for them. In particular, storefronts need a secure reception area that acts as a waiting room so they can limit the total number of patrons in the actual shop.

K K 0 2 0 2 0 220 MID

N LE I ISTRICT A S T D FOR NG AINMEN I D L BUI NTERT E N’S W O T

T U R T O N CO M M E R CI A L R E A L E S TAT E

RECRUIT RETAIN REACTIVATE

OFFICE SPACE FOR LEASE 10,000 SF + 730 I ST | 818 K ST | 830 K ST | 1130 K ST | 1300 U ST| 1919 19TH ST | MARRS | 1725 23RD ST | 2801 J ST | 7919 FOLSOM BLVD | 3000 L ST 106 K ST | 1030 G ST | 2450 5,000 - 10,000 SF ALHAMBRA BLVD | 1029 J ST| 1100 11TH ST | O1 LOFTS | 1530 J ST | 1630 I ST | 1819 K ST | 1401 21ST ST| 2831 G ST | 1102 R ST

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From the same design school that brought you German communist intellectualism and those metal stools you see ever y where!

ISSUE 9

DAVID KHEDRY - DIRECTOR

F A L L 2 0 21

MY LOVE FOR MIDTOWN’S

MID-MOD BUILDINGS Y

You hear it all the time. West Elm says it; your friends say it; even Craigslist posts advertising ornate oak furniture from the ‘80s say it. “Mid-century modern.” But you know what? I don’t mind it. I love the timeless cool and added value of all things mid-mod, especially buildings, and Midtown Sac is home to some groovy ones!

Forged in the aftermath of World War II by engineers and architects fleeing Europe, mid-century modernism is a fusion of Bauhaus utilitarianism and the experimental geometric forms of the International style. More succinctly, it’s that classic “modern” American look which reigned from the late ‘40s through the ‘70s featuring clean lines, simple organic shapes, contrasting materials, repeating patterns, and prioritization of function over form.

This design aesthetic is said to be a natural response to the development of new materials and industrialized manufacturing processes which enabled designers to take bold new artistic (but codified) directions. In the context of architecture, this manifested as huge windows, flat or low-angle rooftops, decorative geometric masonry, cantilevered bulkheads, and a focus on incorporating nature indoors. A number of distinct sub-styles evolved, meaning mid-mod now refers to everything from the Eichler homes of Carmichael to the Jetsons-age Pancake Circus building on Broadway.

In recent years, the style has become remarkably popular, but building regulations and costs means properties like these don’t get built anymore.

Because of the near-universal appeal of mid-century modern buildings and their finite number, they command a higher price point than other spaces

of comparable size and condition. So, although their rarity bums me out, it also increases value for their owners, which is something I can always appreciate.

And beyond the storied history or investment potential of mid-mod buildings, they’re just plain cool! Walking through a heavily-windowed lobby paved in terrazzo tiles and cubical parquet floors with an in-ground tree planter makes my day. Perhaps that’s because the cyclical nature of culture has brought those same founding principles of mid-mod style back into the zeitgeist... or maybe it’s just because so many of my listings are mid-mods.

A RARE MIDTOWN

Office MedMiuidm-mod

A GREAT EXAMPLE OF

ration Incorpo ture of NA

2409 L STREET

A SPLENDID

ie ilding GoogB u

2820 P STREET (SUZIE BURGER)

Suzie Burger’s building is definitely memorable!

It’s classic Googie architecture, which is a futurist sub-genre of mid-mod combining elements of space age and atomic design with car culture. This spot was an old gas station built in 1968. And by the way, their burgers are really, really good.

Mature Japanese maples and huge windows make the second story feel like you’re in the trees! Our former office building looks as if Northern California architect Henry Hill took a crack at redesigning Craig Ellwood’s famous Kubly House in Pasadena.

Some of our team also sees influences of Bay Area modernist Roger Lee with the dark colors, extensive vertical wood paneling, and simple timber post construction. While not architecturally planned, the aggressive wall-climbing vine is charming and furthers the bond between this style and nature.

Unrelated and somewhat useless data from our office!

2425 & 2431 CAPITOL AVE

What color pants are you wearing today?

A LOVELY PAIR OF

ffice Smida-llmoO ds

Blue

n=12 50%

M

What I love about this neighborhood is that every block has a mid-mod gem. These ones happen to be neighbors. The one on the right embodies the famed International style championed by Le Corbusier and Walter Gropius with it’s simple cubic shape, big

2131 CAPITOL AVE

In the Grid, it’s common to see lots of small or large mid-mod offices, but medium-sized office buildings (5,000-25,000 SF) in this style are rarer.

Why is that? Possibly because well-built mid-mod buildings were only financially achievable for either builders of small projects or big organizations with huge budgets. Still there are a few in Midtown!

glass panes, and complete absence of ornamentation. The one on the left also features aspects of the International style while also incorporating the juxtaposed materials and organic color tones of Eichler designs. Simply delectable! *chef’s kiss*

17% Purple

8% 8% 17%

Black Brown

Not wearing pants

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Knock before you come in - I’m self- actualizing!

ISSUE 9

ZAT ION

BROOKE BUTLER - VP - OPERATIONS & MARKETING

SEL

Increases everyone’s enjoyment of their job

EEM

Office employees are proud of

EST

Space impresses visitors Vibe benefits company brand

ING

Inviting part of town

BEL

ONG

Collaboration space Near employees’ residences

CUR

ITY

Bike/car parking

ETY

/ SE

Controlled access

SAF

Private space

HVAC

Dignity Reputation Achievement Prestige Respect of others

Space enhances creativity and open-mindedness Office improves culture and increases employee retention Highly-sought-after/competitive space

Friendship Affiliation Community Acceptance Love Stability Predictability Structure Order Limits

ICA LOG SIO

In exclusive part of town “oh, you work THERE? Wow.” Good lunch / happy hour options nearby Near related industries Friendly neighborhood cats Rules about microwaving fish/broccoli Sun shades Reliable printer Wi-Fi

Air Water Sleep Shelter

PHY

Workstations

Growth Morality Creativity Understanding

L

Bathrooms

CTU F-A

Space perfectly reflects company values

Aligned with company’s growth goals

ALI

Buildout increases productivity

F A L L 2 0 21

Windows Coffee machine

MASLOW’S TURTON’S

HIERARCHY OF OFFICE NEEDS Yeah, it’s cool that your office has nice windowlines and fancy bathrooms and all, but does it enable you to achieve transcendence as a worker?

When you go to the office, do you ever feel like something is missing? The cubicles, bike racks, and copy room are there, but something is just... absent? Everything is perfectly functional and maybe even high quality yet you still don’t want to spend your time there? And so, “I hate the office!” you loudly proclaim before kicking the printer, storming out, and streaking through the forest while reciting Thoreaux excerpts?

You’re not alone! Desk jockeys everywhere trudge into un-

inspiring workplaces on the daily, but it doesn’t have to be this way.

An office can be so much more than a collection of furniture and appliances. It can be a source of positivity and emotional satisfaction which improves your life. To help illustrate the concept, look above at our handy, custom-built chart of needs for an office space that maximizes motivation! In the right location and right space, a company can thrive.

YOUR WORKDAY DESERVES

MIDTOWN TURTON

BBR R AN D D E F I N IN G

URBAN RETAIL FOR LEASE: HARDIN - MARRS - PRESS - BEL VUE - CATHEDRAL SQ - MANSION - SAC COMMONS - LINQ - FORUM 730 I - 731 K - 818 K - 830 K - 1000 K - 1020 K - 1030 K - 716 10TH - 1130 K - 1235 S - 330 12TH - 1414 K - 1415 L 1430 Q - 2401 15TH - 1020 16TH - 1627 16TH - 1616 I - 1705 I - 915 20TH - 2220 J - 2420 K - 2600 J 401 BROADWAY - 1817 BROADWAY - MARKET CLUB AT THE MILL

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Way more interesting than all those serious topics!

ISSUE 9

COREY LAU - CREATIVE DIRECTOR

F A L L 2 0 21

A bartender serving up a Vodka Red Bull at Flamingo House on K. With Silent Discos and an occasional giant ball pit out front, you’re gonna need to load up on the energy-boosting beverages.

MIDTOWN’S

BEST BAR CRAWL ROUTES What’s your vibe tonight?

When they slam their glass down and ask “where should we go next?” you never want to be unready.

So, you wanna impress your friends with a cool bar crawl in Midtown?

Makes sense. Humans and alcohol share a primordial connection.

Whether you drink it or not, it’s an integral part of our culture - and some anthropolgists would even argue a part of our biology. Just like our ape ancestors, we wanna know where the fermented fruit is.

But it can be hard to choose a lineup of

GOOD FOOD AND DRINKS

GREAT FOR SOCIALIZING

venues in our option-abundant modern world. And with bar crawls becoming the casual weekend sport they now are, it’s probably wise to be aware of all of the fun choices in Sac’s urban core. Where should you start? What new appetizers should you try? Will the guys from your high school football team like The Depot? Decide for yourself using our heavily-researched index of evening itineraries below!

A L W AY S POPPIN’

YOU MIGHT BLACK OUT

Try: The Pork Pate Banh Mi

Try: The Schofferhofer Starburst

Warm up for the day’s shenanigans with top-notch bloody marys and high-pedigree stoner food at The Golden Bear!

Down a few steins after a highstakes game of ping pong at Der Biergarten, where every local ends up at some point!

Stagger across the street into The Flamingo House and lounge with your crew on swinging futons beneath trippy lights!

Test your friends’ ability to hold their alcohol at the beloved and recently-reopened Mercantile Saloon (The Merc)!

Try: The Breakfast Musubi (brunch)

Try: The Basilica 3xIPA

Try: The Loaded Duck Fat Fries

Try: To lock your stall door

The ht UrbaN-Nig

Begin your journey at the former industrial space now known as Midtown Spirits, the urban core’s first distillery in over 100 years!

Enhance your already strong buzz with some high ABV seasonal brews at Device Brewing, just one block away in Rice Alley!

Set yourself up for a memorable night with drinks at LowBrau Bierhalle and slowly accrue more social mass before your final stop.

Commit to the night getting weird by rolling with the crew over to The Depot / Badlands’ inter-tangled club complex!

Try: The Uni Bucatini Pasta

Try: The Cheese Board

Try: The Ilegal Mezcal Reposado (ask)

Try: The Rye Flight

Swanky Vibes

Demonstrate your knowledge of obscure culinary ingredients as your friends pore over the menu at Beast + Bounty!

Revel in the hedonistic delights of cheese and wine at The Rind as you judge passers-by for not enjoying life as much as you!

Try: The Impossible Sausage Pizza

Try: The Fried Avocado Tacos

Midtown Loyalist

Suburban Comforts

al My Person te Rou

Try: The Don’t Fight the Feelin’ cocktail Try: The 2 AM hot dog cart on the corner

Try not to let the blackberry Impress your mates with Frank, a margaritas stain your clothes at hidden whiskey-focused speakeasy Zocalo - the first date / celebratory marked only by a blue door with dinner capital of Midtown! the word “cocktails” painted by it!

Try: The Gimme S’more cocktail

Feel miles away from the city at Ease into the urban experience with Run into old friends from high the familiar sight of pizza, beer, and school and meet new people in the The Cabin, the only bar where you’ll conservative political messaging in lively open space at Golden Road find Coors cans, taxedermied game the murals at The Federalist!

Brewing on L Street! heads, and this much Carhartt!

Try: Not to stare at the beautiful people Ignore your friends laughter as you flirt with someone way out of your league at the loud and lively Goldfield Trading Post!

Try: The Al Pastor Quesadilla

Try: The Volcano Bowl

Try: The Smoky Ancho cocktail

Try: To keep the jukebox going all night

Take the gang out for seriously good food and drinks at the shady, always busy Cantina Alley Midtown, our little slice of Mexico!

Mosey down the street for some tropical-themed inebriation at our favorite non-tacky tiki bar, The Jungle Bird!

Combine forces with another bar crawl crew at Kupros, the Mecca of OG Midtowners (appropriately in an old highwater craftsman home)!

Cheat a little bit and leave Midtown for Club 2 Me in East Sac - arguably the homiest dive bar in the area and my favorite place to end the night!

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If you want to go fast, go alone. If you want to go far, go together.

ISSUE 9

DAVID KHEDRY - DIRECTOR

F A L L 2 0 21

WHEN YOU

DON’T NEED A C.R.E. BROKER W

“Why do I need a commercial real estate broker?” Words like these burn bad, but truth be told, there may be times when you don’t need our help...Or maybe you do. Read on to determine for yourself!

If you’re able to comprehend and draft legalese transaction documents AND have time to do it Being a broker involves more than telling people vacancy rates and getting free CoStar lunches. A lot more. Ever try to compare two huge restaurant leases with different legal descriptions of the same things? Or structure the sale of a commercial property while renegotiating a current tenant’s lease to reflect a NNN lease versus the full-service structure they were on? If not, call us for help. If so, head to the flowchart on the right.

If you know everything that is going on with the ownerships and tenants in the market Part of providing value to a client as a broker, is current knowledge about off-market opportunities and what it will take to get a deal done. To be clear, some off-market information is better than others. A broker telling you, “my cousin’s friend whose doctor’s office is at 1234 Main Street, overheard from a client in the waiting room that the doctor could be vacating. Or, was it ‘vacationing’?” doesn’t typically carry the same confidence with it as, “we know of an upcoming availability at 5678 Main Street because the landlord has reached out to us stating they want help leasing the space, and we are giving you first shot at it.”

If you have the talent of a creative marketing agency on-hand Customized marketing plans for a property are an important factor in getting it leased or sold. This much we know. Yet don’t let the simplicity and clean lines of great marketing fool you; it is a time-consuming, detail-oriented, research-heavy task. If your marketing team says things like, “Calibri is totally the new Times New

Roman” or “iPhone photos will work – oops my thumb made it into these pics,” you deserve better.

If ridiculously favorable offers are already pouring in without their help If you are hearing this from prospective tenants, your real estate might be gold-encrusted: “Hello! I was calling to lease your 5,000 SF restaurant space. I will pay full market rent, 3.5% annual increases in rent, request no renewal terms, and accept your Landlord draft lease with minimal review. Also, I will take care of my $120 per SF tenant improvements, manage the process myself, and provide you with free services to my business anytime.” If you aren’t hearing this, let’s grab a coffee and see if we can change that.

If you don’t care about maximizing your property’s value Maybe the under-market rents are your thing. Maybe your parents are your anchor tenant, and they put coal in your stocking during the holidays when you increase their rent. Maybe getting inquiries from ambitious brokers just makes you feel powerful. Whatever the case, you don’t really care!

If you’re in a 100% perfect space and never need to move Sometimes, miracles happen. Every doorway, hallway, office, conference room, and light switch make sense.

The building exemplifies your brand perfectly. Your clients don’t want to leave when they visit. You haven’t lost a single employee, and they donate free overtime just so that they don’t have to leave. The Wi-Fi signal is strong from every corner of the building. You love your rent and don’t feel there is a single penny to be saved, or additional benefit to be had by evaluating the options on the market.

FLOWCHART:

SHOULD YOU BE A BROKER? Like hard work?

No

Yes Are you smart?

No

Yes No

Can you handle repeated rejection?

Yes You okay with faces on business cards?

Yes

No Try Commercial Brokerage!

Try Residential Real Estate!

Try making a magazine when you’re not a publishing house!

Try Title and Escrow!

Try Lending!

Above: David Khedry reviewing a space plan with an incoming tenant and advising on value engineering their space.

WE ARE YOUR MISSING PIECE LANDLORD

SELLER

BUYER

TENANT

THE

MARKET CLUB MILL AT THE

2630 5th St Authentic Retail Space for Lease in Urban Sacramento’s Largest Infill Development

T U R T O N CO M . CO M

916 . 573 . 3 3 0 0

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Finally, some content relevant to ME. ISSUE 9

PATRICK STELMACH - SENIOR DIRECTOR

F A L L 2 0 21

FOR YOUR CONSUMPTION:

ANALYSIS OF LOCAL VEGGIE BURGERS O 1

Of one thing there can be no doubt: haters on veggie burgers who’ve never tried them are truly missing out. Today’s options are blocks ahead of the flash-frozen soy discs of yesteryear. If you’re not already vegan / veg-curious, you might just wanna try it out. And Midtown’s got options for you!

WHAT MATTERS MOST IN A GOOD VEGGIE BURGER?

Plant Power

1100 R Street

Price: $7.95

Size: Large

With their own proprietary impossible meat blend, Plant Power has earned a solid reputation in town with lovers of condiment-soaked burgers.

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Burger Patch

2301 K Street

Price: $7.90

Size: Adequate

Although smaller in scale, keen attention given to bun toasting and the ratio of ingredients makes this burger the most consistently enjoyable one in town.

3

Rabbit Food Revolution

Food truck!

Price: $12.00

Size: Huge

Many vegans find themselves grimmacing at the large burgers which decidedly do not taste like rabbit food.

But for us, that’s a sign of a skilled chef!

4

Sibling by Pushkins

Vegetable-like

Like real meat

More patty

More toppings

Dry

Artisan roll

Liquid cheese

Actual slice

Vegetable-like

Like real meat

More patty

More toppings

Dry

Artisan roll

Liquid cheese

Actual slice

Vegetable-like

Like real meat

More patty

More toppings

Size: Medium

While not in Midtown, Darling Aviary deserves to be included for making Brooke, a lifelong vegetarian, proclaim it’s the best burger she’s ever had.

4.00 1.5

2.25

Bun Quality

.75

Meatiness of fake meat

2.00

Topping : Patty Ratio

A troubling veggie burger dynamic:

Dry

Saucy

Grocery store bun

Artisan roll

Liquid cheese

Actual slice

Vegetable-like

This one exhibits qualities of an extremely high-end burger and is sandwiched between two gluten-free buns.

Depends if you like that sort of thing.

Price: $9.00

Moisture Level

Cheese Quality

Saucy

Grocery store bun

Dry

712 K Street

How do you measure a veggie burger? We gave our coworkers 12 points to distribute amongst qualities they value most in one and averaged them. Each quality maxes out at 5 points. n=8

More patty

Darling Aviary

Saucy

Grocery store bun

1813 Capitol Ave Price: $14.00 Size: Medium

5

Dataphilia:

Like real meat More toppings Saucy

Grocery store bun

Artisan roll

Liquid cheese

Actual slice

Vegetable-like

Like real meat

More patty

More toppings

Dry

INGREDIENT DEFENESTRATION Bite Loss Bite

Frequently overlooked by kitchen staff (but always noticed by those eating), this dynamic refers to the loss of internal sandwich matter which takes place during mastication. This is caused by a hardening of the bun during the toasting process which increases the structural strength of the bread and makes each bite more likely to force a glob of innards out the opposite end. Not only does this result in decreased burger volume - it can cause overwhelming disappointment.

Common workarounds include wrapping the burger in paper or foil or using highly delicate bread that tears easily.

Saucy

Grocery store bun

Artisan roll

Liquid cheese

Actual slice

Above: The Revolution Burger with house made cashew cheese from Rabbit Food Revolution. This local food truck is worth seeking out and is often found at SacYard & Porchlight.

What color pants are you wearing today?

2031 K FOR SALE

MIDTOWN

Corner Lot · Multiple Parking Lots · Office or Retail

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9

Is making money right for you? A sk your broker today!

ISSUE 9

JON LANG - VICE PRESIDENT

PLAY-BY-PLAY OF

A HIGHLY GAINFUL DEAL

This one resulted in a client’s comfortable retirement, the development of an underused parking lot, and an investor making bank.

They’re not uncommon. They happen all the time. And they’re my favorite part of my job. I’m speaking, of course, about tidy transactions in which all parties benefit significantly.

Here’s a look at an approachable deal where both parties acquired real estate that more strongly aligns with their investment goals.

The Seller was an owner-user who loved her building in Midtown, but didn’t necessarily want to renovate or manage an office property. She sought

Vague information which supports our narrative! % of TCRE deals where both parties leave happy:

THE

!

meline Seller Ti

% of other firms’ deals where both parties leave happy:

10%

F A L L 2 0 21

1

Local Dentist owns and operates dental practice out of 2431 N Street in Midtown.

2

Contemplating retirement, decides to sell the Property and reinvest the funds into income producing asset.

3

Ultimately identify local developer, who buys the property for $512,000.

100%

a passive investment that needed little attention and found that in a wellkept Land Park duplex.

On the other end of the transaction was the Buyer who aimed to build wealth through infill development projects in Sac’s urban core. His development interest was not in the existing building (which is a super cute mid-mod, by the way) but in the included surface parking lot. He envisioned building two townhomes and selling the three buildings separately for a magnified profit.

And hey, in the end, not only these two benefited - the neighborhood also gets to say goodbye to a giant plot of asphalt!

THE

!

Timeline Buyer 1

Presents 2431 N Street to HK3 Development, a local development firm buying infill development sites in Midtown.

Property is sold to buyer with big plans

2

HK3 Development closes escrow on 2431 N Street for $512,000.

Former owner moves money into income-producing asset

4

Seller takes advantage of tax-deferred exchange and purchases a duplex in South Land Park.

3

Submits plans to city to construct two, 3-story townhomes on the parking lot, keeping the existing dental building.

5

Replacement property (duplex) generates 5% annual return, or approx. $25,000 per year. Veddy nice!

4

Parcel is divided into three separate parcels, one for the dental building and one for each of the new townhome.

5

Now on its own parcel, dental building can be sold off for $450,000, reducing basis on 2,200 SF parking lot to $62,000 or $28 PSF.

6

Construction on both townhomes will begin in Fall 2021, with each townhome worth between $750-$950,000.

Properties are sold after being developed

7

HK3 Development profits from the sale of both townhomes.

Top Two: Renderings of the sleek new townhomes at 2431 Street. Visit HK3development.com for more info. Below: The existing mid-mod dental building at 2431 N Street that will be available for lease or sale.

6,314 SF FOR LEASE

1,885-2,647 SF FOR LEASE

2,101-15,366 SF FOR LEASE

6,823 SF FOR LEASE

COMPANY CULTURE STARTS WITH YOUR OFFICE SPACE

TURTON COMMERCIAL REAL ESTATE | 916.573.3300 | TURTONCOM.COM

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1

In the city of Trees, it ’s easy to find a cool part of town!

ISSUE 9

JACK SCURFIELD - DIRECTOR

F A L L 2 0 21

FIELD GUIDE TO SACRAMENTO’S

GRID-ADJACENT NEIGHBORHOODS V 1

Variety is the spice of life, they say. We’re still researching who “they” are, but we agree with them. And luckily for Sacramentans, variety and intrigue are abundant in the immediate off-Grid neighborhoods. Need tips on what to check out? You’re in the right place!

The Bridge District (West Sacramento)

Common: Noticing a large amount of young professionals pulling their dogs away from the goat herd on the levee Uncommon: Soft good retailers (for now) Top 3 Amenities: The BARN, the River Walk, and the Thursday evening farmers market Hidden Gem: The beach by Broderick Boat Ramp

Distinct from its industrial past, West Sac’s waterfront has been totally reinvented into a high-density mixed-use neighborhood.

Continued developments and a steadily increasing population are promoting growth in this area’s historically low-key retail scene (it’s now home to the incredibly popular waterfront destination, The Barn).

Trees, stadium lights, and modern homes are blended against an impressive view of Downtown. Some people seem to think West Sacramentans have an inferiority complex being compared to hootin’-tootin’ Sac proper, but just ask anyone who lives there about it and they’ll say, “at least we didn’t build a freeway over our waterfront.

AV E R A G E C O M M E R C I A L S A L E P R I C E / S F B Y N E I G H B O R H O O D

The Bridge District: $147 / SF Land Park: $217 / SF Curtis Park: $194 / SF

Oak Park: $305 / SF Tahoe Park & Elmhurst: $222 / SF East Sacramento: $352 / SF

Source: CoStar (2021)

B R I D GE D I S T R I C T S I Z E Residential:

5,210 units

The Bridge District

East Sacramento

Commercial:

7.29 million SF

More data of questionable relevance from our office!

Which urban art gallery is coolest?

The Grid

Art House

n=10 20%

Elmhurst & Tahoe Park Curtis Park Land Park

Don't want to reveal to normies

50%

10%

Elliot Fouts

20% B Sakata Garo

Oak Park Top: Garden Park in the River District. Middle Left: Drake’s Brewing Co at the BARN serving up their Flyway Pils. Middle Right: Subtile art sculpture by Federico Díaz on the River Walk Trail. Bottom: Aerial view of the BARN.

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2

FIELD GUIDE TO SACRAMENTO’S GRID-ADJACENT NEIGHBORHOODS

AV E R A G E H O M E S A L E P R I C E B Y N E I G H B O R H O O D

The Bridge District: ~$600,000 Land Park: $821,000 Curtis Park: $714,000

2

Source: Zillow (2021) Oak Park: $449,000 Tahoe Park & Elmhurst: $505,000 & $610,000 East Sacramento: $748,000

Land Park

Common: Nextdoor posts for mundanities like broken sprinkler heads Uncommon: Finding a fixer-upper Top 3 Amenities: Meet & Eat, Freeport Bakery, and access to the American River Bike Trail Hidden Gem: The amazing Rock Garden in William Land park

While I’m certainly biased due to being raised here, I know it’s not just me who loves Land Park’s neighborly warmth and charming, shady streets. The homes in this particular area tend to be high-end, but not glitzy or tasteless. Also, on the subject of taste, residents here are sandwiched

3

between Broadway and Freeport - two of the best food corridors in the city. And although it may not offer many nightlife options, Land Park’s blissful aura, massive park, and direct access to the Grid make it more than satisfactory for the well-to-do who dread the isolation of newer suburbs.

Curtis Park

Common: Hearing the word “Labradoodle” Uncommon: Driving through without getting confused by the street structure Top 3 Amenities: Gunther’s Ice Cream, Hop Gardens, Café Dantorels Hidden Gem: The bagels at River City Deli

Defying stereotypes, Curtis Park proudly proclaims, “we’re a fancy neighborhood even if we’re squished between Highway 99 and the railroad tracks.” Walking through this neighborhood, you’ll notice almost every yard has either fruit trees or mature landcaping clearly planned by a serious

4

hobbyist. Huge trees and a massive central park with a perfect 1-mile perimeter contribute to the lifestyle which has made this area so high-demand. The vibe is almost Davis-like with a more earthy feel than Sacramento is known for. Oh, and the best ice cream in California is supposedly here.

Oak Park

Common: Nearly getting hit by a frisbee coming from the disc golf course while at the farmers market Uncommon: Feeling compelled to walk below 14th Avenue at night Top 3 Amenities: La Venadita, Oak Park Brewing, Faria Bakery Hidden Gem: The interactive water sprayers at McClatchy Park A SURVEY OF RANDOM SACRAMENTANS! The Grid-adjacent neighborhood you most want to live in is:

Curtis Park

Land Park 20%

17% 7%

East Sac

n=29

48%

4% 4%

Tahoe Park

With the central city no longer being the gold mine of reasonably-priced housing it once was, Oak Park is becoming the natural funneling point for Sacramento’s young professionals, artists, and small business owners. And medical professionals, too, but more because of the presence of the rapidly-growing UC Davis Medical center on the edge of the neighborhood. Being a former

streetcar suburb, the city blocks and individual parcels here share dimensions with the rest of the Grid, imparting a highly urban feel on the area. And, as can be expected for the area’s most rapidly-gentrifying neighborhood, there’s a building made of containers, a brewery in an old auto shop, and a furious landrace for any starter homes that hit the market.

Oak Park Bridge District

Top Left: A fresh butter croissant from Freeport Bakery in front of their colorful signage painted by local artist Jeremy Stanger. Below That: A charming house in Curtis Park that you hope one day may hit the market. *Swoon*. One More Down: Beers at Hop Gardens - a favorite for many Curtis Parkers. Bottom Left: Local artist Caroline Dale snapping photos of Curtis Park’s beautiful flora.

#SundayFunday on the Broadway Corridor in Oak Park

scan for brochure

INSPIRE HIDDEN GEM: 1919 19TH STREET LOCATED ON THE R ST CORRIDOR OWNER-USER OR INVESTMENT $5,900,000 - 18,650 sf

2

5

FIELD GUIDE TO SACRAMENTO’S GRID-ADJACENT NEIGHBORHOODS

5

Tahoe Park & Elmhurst

WORDS WITH NEIGHBORS What’s your favorite part about living in East Sacramento?

Common: Seeing a cyclist in full medical scrubs Uncommon: Getting seated right away at Bacon & Butter Top 3 Amenities: Bacon & Butter, Village Drive-in, and Sac City Brews Hidden Gem: The hot Indian food at Cottage Mart

Tahoe Park has all the cuteness of the bougie neighborhoods but with an endearing lack of pretentiousness. Everything here feels “real.” No colorful townhome developments; no buildings named after their cross-streets; no local artists pretending to be relevant by painting angsty text on road signage; etc. The main grocery store is called Family Grocery. As you head north

6

“Property Values…and Corti Brothers.”

-Kyle Decoque “Neighbors are very involved and beautiful homes!”

-Bryan Carter

toward Elmhurst, the trees increase in size and homes in regality to match East Sac across the freeway. News about this area is often overshadowed by the medical center’s ongoings, which has kept this area under many peoples’ radar. And while all this may sound like it’s a stuffy field of NIMBYs, to me, it’s one of the most easygoing and diverse neighborhoods in all of Sacramento.

East Sacramento

Common: Getting confused by the two parks where streets should be Uncommon: Seeing large groups of young people walking around Top 3 Amenities: Orphan, Kru Contemporary Japanese, SacYard Community Tap House Hidden Gem: The cronut at Stanely’s

You’ve probably already heard about this one. Perhaps one of the “nicest” neighborhoods in northern California, East Sac boasts high property values, adorable boutique businesses, and [likely] the highest concentration of purebred dogs in the county. Loved for its immediate access to Midtown, bike-friendly roadways, and gorgeous homes, many find themselves unable to compete with the high demand to live

here. Old craftsmans, turn-of-the-century bungalows, and European revival custom houses line deeply-shaded streets, but new high-density developments are turning the east end into a college town. The roadways are widened and perpetually busy with joggers and cyclists. River access, while not as immediate as you’d imagine, is still present.

And, if you’re lucky, the ducks at McKinley park will eat right from your hand!

Top Left: Sac City Brews - a laid back tap house with amazing breakfast tots! Top Right: UC Davis Med Center - special shout out to all our healthcare workers! Below That: Healthy option at Sac City Brews.

And Below That: Aerial view of East Sacramento. Bottom: OBO’ on Folsom Blvd.

nd

2 n e G

Restaurant ONCE-IN-A-DECADE OPPORTUNITIES WITH INFRASTRUCTURE IN PLACE THE HARDIN - THE FORUM BUILDING - 1020 K STREET - 1030 K STREET - 1000 K STREET - 1627 16TH STREET 1100 11TH STREET - 1020 16TH STREET - FOR LEASE 2531 J STREET - FOR SALE

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7

Why pay full price when someone else already has?

ISSUE 9

JUSTINE WONG - MARKETING ASSOCIATE

MIDTOWN

THRIFT SHOPS!

F A L L 2 0 21

Embroidered jacket Freestyle

Spending a little time in Midtown will make you a connoisseur of all things vintage. Here are some cool finds I grabbed from local thrift shops!

Denim Jacket Peek A Boo

1 Old Gold Handmade goods, clothing, jewelry Location: 1104 R Street #110

Price: $$

Looking for an outfit that loosely resembles your fave ‘90s movie? Check.

Looking for one-of-a-kind jewelry?

Check. Looking for handmade giftables? Check. Old Gold is the hidden gem located in the WAL Public Market and is for those vintage era fashionistas!

‘90s Shirt Old Gold

Leather Purse Old Gold

2 Freestyle Clothing Exchange

4 Shop Modern Nostalgic

Clothing Location: 1906 L Street

Furniture, art, home décor Price: $$

Pro tip: Plan to give yourself lots of time to “shop till you drop” because you’re gonna need it at Freestyle Clothing Exchange! This large local thrift store seems to have an endless selection of secondhand clothing, shoes, and accessories. Plus, their onpoint music really pumps you up for the occasion!

3 Peek A Boo @ Prevues

Location: 1715 R Street

Penny Loafers Freestyle

Head Statue Shop Modern Nostalgic

Clothing, costumes, jewelry Location: 2417 K Street

5 Upscale Thrift

Price: $$

Hidden away in the heart of Midtown across from Tres Hermanas, Prevues is a packed-full costume wonderland - like a compact version of Evangeline’s in Old Sac. You’ll be more likely to find vintage daily wearers here, though, and their selection of jewelry is rivaled only by the high volume of leather dominatrix outfits. Getting ready for Halloween? Preparing for Burning Man? This is your stop!

Price: $$$

The saying on the window “old is the new new” truly represents what Shop Modern Nostalgic is all about. It’s like a blast from the past but with a midmod touch to it. Airy, yet warm, this local vintage shop at the Ice Blocks carefully showcases each of their hand-picked furniture, décor, and artwork. Even their Instagram makes you want to up your interior design game… or your social media game!

Clothing, jewelry, home décor, toys, kitchen goods Location: 2590 21st Street

Water Glasses Upscale Thrift

Price: $

One man’s trash is another man’s treasure. Think outside the box and Upscale Thrift has it all. Pick your favorite decade and this funky thrift store probably has something for you – groovy patterned dresses, kitchen appliances and home décor straight from the ‘60s, furniture that your grandparents probably have, and much more!

P RO

JECT

ATE ELEV

ELEVATE YOUR CITY NOW SEEKING DEVELOPERS. BE PART OF WHAT’S NEXT FOR ELK GROVE.

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9

We don’t want to brag but... Okay, yes we do.

ISSUE 9

KEN TURTON - PRESIDENT

F A L L 2 0 21

OUR INVOLVEMENT IN THE

EVOLUTION OF SACRAMENTO L

Local governments, developers, small businesses, artists...There are a lot of parties involved with changing the trajectory of a city. And playing matchmaker between them all are commercial real estate brokers. Here’s some deals we played cupid in!

DOWNTOWN P RO J E C T S Capital Public Radio Building Former Bank of America Building 730 I Street 60,000 SF building on 52,000 SF half-city block parcel on I Street between 7th and 8th Streets. Represented Seller, Buyer, Landlord and Tenant.

This Property was vacant and inactivated for about 10 years. Originally built in the ‘60s as a build-to-suit for Bank of America, it was most recently used as a temporary City Hall while the new City Hall was built.

The Property was purchased in 2018

by D&S Development. In 2020, Turton Commercial represented Capital Public Radio to lease 32,000 SF of the building bringing in approximately 120 new employees.

Cambria Building 731 K Street 20,000 SF vacant former bank building. Represented Seller, Buyer and currently Landlord.

This was an old vacant, dormant bank building that could only be described as an eye-sore in the heart of K Street. The Property was sold by the City of Sacramento and purchased by Cassadyne who completely renovated the property’s exterior and interior. This was a complex transaction that required significant interaction with EDD, City planning department, and Market One Builders. Today, 731 K Street is one of, if not, the most attractive buildings on K Street. It is owned by Cassadyne and occupied

by Cambria who will be bringing a minimum of 60 workers with average incomes in excess of $100,000.

800 Block of K and L Streets 800 K Street & 801 L St Assemblage 50,000 SF of land and 30,000 SF Historic Bel Vue Apartments. Represented Seller and currently Landlord.

Turton Commercial represented the City of Sacramento in generating 5 quality offers for the Property ultimately resulting in the Sacramento Kings ownership group exercising their first right of refusal to purchase the Property from the City. CFY Development, as part of that ownership group, completely renovated The Bel Vue Hotel affordable housing component. The remaining property will be developed into a 200+ unit apartment complex over 20,000 SF of retail perfectly in alignment with the City of Sacramento’s K Street Redevelopment objectives.

Montgomery Ward Building 830 K Street 60,000 SF Mixed-Use office/retail Building. Represented Seller, Buyer and currently Landlord.

This property had been vacant and inactive for over 15 years. TCRE represented Seller and Opportunity Zone Buyer who immediately renovated the entire building which is now occupancy-ready.

Roos Atkins Building 1001 K Street 44,500 SF historic redevelopment resold as individual condos to office and retail. Represented Buyer of entire building and Sellers of the individual units.

Turton Commercial represented Signal Hill Petroleum to purchase this broken condo project out of foreclosure. During escrow TCRE worked with SMUD and the City of Sacramento to bring in additional power from a nearby vault and resolved the problem for $400,000.

Upon completion the building received its certificate of occupancy and TCRE went on to sell 6 of the 7 individual condos. Today the building is fully activated.

930 K Street

Weinstocks Building 1130 K Street

30,000 SF Historic Redevelopment Property. Represented Seller and Buyer.

Vacant 30,000 SF property slated for new hotel.

200,000 SF Mixed-use Office/Retail Building. Represent: Landlord.

Opportunity Zone Developer hired TCRE to lease this completely renovated 200,000 SF building.

Former Clarion Hotel Assemblage 700 16th Street and 1601 H Street 110,000 SF former Clarion Hotel and vacant lot. Represented Seller, Buyer and currently Landlord.

Sold one-half city block and one-quarter city block consisting of a vacated (since 2006) former Clarion Hotel and a vacant lot across 16th Street. The Property was ultimately purchased by SKK Developments who is developing an 80-unit live/work apartment complex and a 160-unit mixed use multi-family project that includes 10,000 SF of retail.

Maydestone Apartment Building 1001 15th Street 32 unit blighted vacant apartment building. Represented Seller and Buyer.

This Property was in escrow from 2002 – 2008 due to a value dispute created by fire damage and resulting insurance reimbursement to Seller. Ultimately, after years of litigation, Turton was hired to find a resolution. Turton identified a buyer and effectively negotiated a buyout of the existing contract during one of the worst economic periods in our history. What was once a burned out, boarded up, blighted building is now one of Sacramento’s most attractive, restored historical properties occupied by over 50 residents.

1601 J Street In contract, non-refundable. Turton Represents Buyer and, ultimately, Landlord.

This will ultimately be a 200+ Multi-Family Residential Project over approximately 10,000 SF of retail on the NE corner of 16th and J Streets.

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28

outhside Park

0

4 29 7

20

3

4 30

15

17

St. Rose of Lima Park

3

Cal EPA Building

6

Masonic Temple

16 y

22

8th Street

120,000 SF of buildings on 7 acres of land. Represented Seller, Buyer and currently Landlord.

A transformative transaction in one of the most blighted areas of the River District. Working in tandem with Jeff Harris and the City of Sacramento, TCRE identified an Opportunity Zone Buyer with enough vision, belief and capital to completely transform this market over the next 5 years.

Mansion

Growers District 200 North 16th St, 211 North 16th, and 1610, 1616 North C Street

24

Memorial Auditorium

16

RIVER DISTRICT P RO J E C T S

7

St.Paul’s Episcopal

Sacramento Church Convention Center

25,000 SF mixed-use office/retail building. Represented Seller, Buyer and Landlord.

Turton represented the original seller and buyer of 2407 J Street to facilitate the occupancy of Rick’s Dessert Diner which transformed the project and preserved one of Sacramento’s urban jewels.

9

2407 J Street

Sheraton Grand

9th Street

10th Street 11th Street 12th Street 13th Street 14th Street 15th Street

16th Street / Lincoldn Highway 17th Street 18th Street 19th Street 20th Street

28,000 SF Development Parcel. Represented Seller and Buyer.

This 28,000 SF land parcel was transformed into the 6 story parking garage over 12,000 SF of office cur-

26

21st Street

22nd Street 23rd Street

24th Street

50,000 SF warehouse conversion to mixed use office/retail/restaurant.

Represented Seller, Buyer, Landlord and many of the Tenants.

21st and Capitol Avenue 2101 Capitol Avenue

rently occupied by Rainforth Grau architects. While this doesn’t scream “amazing” it was an essential part of a much larger transaction that will facilitate the development of a 240-unit apartment over 40,000 SF of retail planned for 21st and L Street.

15

MARRS 1050 20th Street

20PQR West side of 20th Street (P – R) 52,000 SF Land Development Parcel Represented Seller and Buyer TCRE sold 52,000 SF of vacant contaminated land bordering the Union Pacific railway. Today there are 24 modern single family homes there.

Midtown PBID - Zone 1

12,800 SF parcel at 19th and J Street. Represented Seller and Buyer.

Sold 12,800 SF parcel which was subsequently developed into 19J, an 11 story “affordable-by-design” mixed-use multi-family building.

Q19 1907 Q Street Represented Buyer and Seller of land and finished mixed-use apartments.

Represented Buyer of the land originally in 2008 who eventually sold the property to SKK Development and Grupe who built the 75 unit over 5,000 SF of retail mixed-use complex known as Q19. TCRE represented SKK and Grupe on the sale and Woodmont Properties on the purchase.

3

19J 1827 J Street

Turton was hired to sell a 50,000 SF warehouse located at 20th and J Street. The Property had no parking, virtually no windows and was underpowered. Today it is fully activated as the Midtown Arts Retail and Restaurant Scene (MARRS) Building and is the one of the urban cornerstones of fabulous Midtown Sacramento. Turton leased the office and retail tenant space to 100% occupancy.

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1

MIDTOWN P RO J E C T S

IMAX

1430 Q Street 60,000 SF Mixed Use Residential/ Office Midrise. Represents Landlord.

Turton was hired to lease the retail in this state-of-the-art mixed use residential/retail project.

Cathedral of the Blessed Sacrament

19

18th

14

Midtown PBID - Zone 2

13

10

16th

1200 R Street 24,000 SF warehouse. Represented Seller and Buyer.

Turton Commercial Real Estate sold this old electrical storage building to a developer who fully renovated and re-purposed the Property as an office and retail building. It is now one of the most attractive buildings on R Street, is home to HGA and Market One Builders, and features a Starbucks Coffee House. It’s brought over 100 employees to the submarket with average incomes over $80,000.

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Fremont Park

Community City Theater

14th

Ice Blocks 1700 R Street Represented Landlord.

Turton was involved with this development from the project inception. Hired to lease the original Ice Manufacturing facility for office occupants, Turton pre-leased 90% of the project before it burned down.

Retained to lease the new 100,000 SF of office, Turton pre-leased 90% of the office portion before the first tenant occupied and 10,000 SF of retail tenants at the project.

Hyatt Regency

B&G Building 1100 R Street 11,000 SF Mixed-use office over retail building. Represents Landlord.

Turton originally represented Landlord and Tenant in the property which currently houses Dudek Engineering and Plant Power on the west end of Warehouse Artist Lofts.

Crest Theatre

California State Capitol Building

12

th

21

California Museum

40,000 SF office and warehouse.

Represented Seller, Buyer and currently Landlord.

TCRE was hired to sell this warehouse in the heart of the RMX zone.

Today the Property is fully occupied and includes Market 5-ONE-5 grocery store in this rapidly developing residential market.

City Hall

2

Market 5-ONE-5 Building 1724 10th Street

Citizen Hotel

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Rosevelt Park

16 Powerhouse 1601 P Street 50,000 SF Mixed-Use Apartment.

Represented Seller and Buyer.

Turton played a significant role in the developer selection for this project.

Upon completion, Turton represented D&S in the sale of the building, a 50+ luxury unit apartment complex over 7,000 SF of retail, for $32.5 M.

Cesar E. Chavez Plaza

R STREET CORRIDOR P RO J E C T S

Q

Library

R

CA State Library

ment Develoapp!

M R ST CORRIDOR

S

Leland Stanford Museum

O U R I N V O LV E M E N T I N T H E E V O L U T I O N O F S A C R A M E N T O

25th Street 26th Street

T URTON COMMERCI A L R E A L ESTATE - 916.573. 3309 - T URTONCOM .COM

23R

VALUE-ADD INVESTMENT/DEVELOPMENT SITE ON THE R STREET CORRIDOR FOR SALE OR LEASE $10,575,000 $2.35/SF/MONTH

TODAY’S MARKET CALLS FOR A

steady hand

WE KNOW THE NUANCES THAT CAN TOPPLE A DEAL LANDLORD, TENANT, BUYER, SELLER REPRESENTATION

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If this article isn’t interesting enough, write your congressman!

ISSUE 9

PATRICK STELMACH - SENIOR DIRECTOR

F A L L 2 0 21

QUICK TAKE: WHY BUILD AFFORDABLE HOUSING? • • •

DOES AFFORDABLE HOUSING

MAKE MONEY? W

With developers being in business to make money but affordable housing rents being well below construction and maintenance costs, some wonder why they build them. There’s good reason!

Don’t worry, it’s normal to find it puzzling. Private developers routinely remind us that they need market rate rents for their buildings to make a profit, so why do so many get involved in affordable housing projects with below-market rents? Doesn’t that mean a developer would lose money on the project?

Contrary to this completely logical view, affordable housing can be a cash cow. Most people think that affordable housing is only developed by nonprofits and government agencies, but it turns out that robust money-making opportunities for the private sector exist in the form of tax benefits, fees, and risk-adjusted returns.

Developers of affordable housing

use traditional methods to maximize profits like choosing neighborhoods with strong rental markets, mixing market-rate units into their buildings to increase operating income, and planning exit strategies to maximize sale proceeds. The big differences from building market rate apartments are that they receive extra fees which don’t commonly exist outside of a public-private development partnership.

A vertically integrated developer will have a development, construction, and property management company. They take a fee for construction, a developer’s fee, and then a management fee once the property is occupied. In addition to the developer’s fee, the developer of the affordable

Consistent Cash Flow Generous Tax Incentives Builds Healthy Communities

Contact a broker for in-depth info!

housing property sells the stream of tax credits to an investor.

A quadruple play! No wonder affordable housing is big business. What makes this economically feasible for the developer are ongoing government subsidies which close the rental income gap and support the operating costs of the building. And, because of these subsidies, high occupancy, and low turnover, affordable housing buildings are regarded among most reliable of real estate investments (meaning an easy sale).

There are a variety of ways these deals are structured between developers, nonprofits, and government agencies. It also really depends on how much soft debt (other public funding sources, grants, loans) a developer can get, and construction costs and land basis. In areas where land values or construction costs are high, the fees will usually be deferred and paid back as part of the income stream.

But wait. What’s the advantage of having a private developer versus a government agency? Isn’t that just another fee? That’s a good question! In particular, they usually bring significant financial and technical resources to deals which increases their speed of completion and thus their overall cost. Developers’ ability to cover the costs of acquiring land or buildings, as well as the up-front development costs, allows them to move more efficiently than notoriously sluggish nonprofits and public agencies. This also means that more units are delivered overall. Additionally, privately-built affordable units are often partially market rate, meaning that their projects bring greater economic diversity to a community instead of a segregated tower of low-income residents commonly seen in public buildings.

Sacramento does not have enough affordable housing. To meet our community’s needs, we must build thousands more units. While public agencies and non-profits do a lot of the heavy lifting, we can’t achieve our housing goals without help from the private sector - and it’s in their best financial interest to get involved.

Top: Turton Commercial sold the vacant and blighted Historically Registered Bel-Vue Apartments at 801 L Street. CFY Development as the private sector developer rehabilitated the building into 21 affordable units, and the adjacent vacant land is slated for an additional 100 affordable units when completed.

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How often do you get to actually be part of the solution?

ISSUE 9

SCOTT KINGSTON - VICE PRESIDENT

THE UNTAPPED POTENTIAL OF

PROJECT HOMEKEY A

As you’re surely aware, not everyone has the resources or background to secure market-rate housing for themselves. Project Homekey is a solution which benefits individuals, communities, and motel owners.

F A L L 2 0 21

AV G C O S T P E R D O O R

Sacramento Area $105,863

Bay Area $155,294

Project Homekey funding goes approximately 30% further in Sacramento than in the Bay Area. This can equate to 30% more in-need individuals being housed.

2 0 2 0 T O TA L H O M E K E Y AWA R D S B Y R E G I O N Project Homekey is one of the State of California’s primary mechanisms to provide future residency options for Californians experiencing homelessness.

Administered by the California Department of Housing and Community Development (HCD), grant funding has been made available to local public entities, including cities, counties, or other local public entities, including housing authorities or federally recognized tribal governments within California to purchase and rehabilitate housing, hotels, motels, vacant apartment buildings, and other buildings and convert them into interim or permanent, long-term housing.

The first phase of Homekey’s funding, which totaled $600 million has been exhausted. However, due to the success of Project Homekey last year, the California legislature has committed to re-invest significantly in Project Homekey, with $1.45 billion committed in fiscal year 2021-2022 and $1.3 billion committed in fiscal year 2022-2023. This will further the successful pace of the first round of Project Homekey, which consisted of over $800 million awarded to 51 local agencies for 94 projects to provide over 6,000 housing units.

The first round of Homekey funding was awarded to approximately half (56.9%) of California’s 58 counties to purchase and rehabilitate housing (including hotels, motels, vacant apartment buildings, and other buildings and convert them into either interim or permanent housing including supportive housing).

Next Steps in 2021 and 2022 Local public agencies will have another opportunity to apply for Project Homekey funding to purchase and rehabilitate housing for either interim and/or permanent housing including supportive housing within those counties not previously awarded funds Building upon the success of Homekey also involves including an increasing investment in behavioral health continuum infrastructure and Adult Residential Facilities and Residential Care Facilities.

The proposed budget also recommends $250 million one-time General Fund for the Department of Social Services to counties for the acquisition or rehabilitation of Adult Residential Facilities (ARF) and Residential Care Facilities for the Elderly (RCFE) with

Bay Area

$274.5 M

Los Angeles Area

$268.4 M

Southern California

$69.5 M

San Joaquin Valley

$63.2 M

Sacramento Area

$38.6 M

San Diego Area

$37.7 M

Balance of State

$25.9 M

Central Coast

$22.7 M

H O M E K E Y F U T U R E F U ND I NG Project Homekey has been incredibly successful, prompting the government to allocate more funding over the coming years. Motel owners should take note!

2020-2021

$600,000,000 2021-2022

$1,450,000,000 2022-2023

$1,300,000,000

Top: Sutter County recently purchased a 62-room hotel using funds from a $6.7-million-dollar grant from Project Homekey.

The operation will be entirely under the umbrella of Habitat for Humanity.

TURTONCOM.COM

development opportunities URBAN: 701 DOS RIOS: 181,645 SF

LOT X: 111,641 SF

|

2601 5TH: 99,033 SF

| 2131 16 : 19,600 SF | 1511 I ST: 16,000 SF 339 ARBOGA: 47.00 AC | 6127 MYERS RD: 10 AC | 401 WATERMAN: 8.79 AC

CASCADE: 25,600 SF RURAL:

|

OPPORTUNITY ZONE

TH

| THE WP: 62,200 SF | 2311 CAPITOL: 12,800 SF | | 7E: 14,728 SF | 929 DREVER ST: 12,197 SF | | 8140 FREEPORT: 1.06 AC | 1414 DEL PASO: 1.03 AC |

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THE UNTAPPED POTENTIAL OF PROJECT HOMEKEY

Harmony Village, previously the Baymont Motel, in Yuba City.

a specific focus on preserving and expanding housing for low income seniors.

There are many benefits to the communities in California that have participated or will participate in Project Homekey: •

•

• •

Lower transmission rates among the homeless and community of COVID-19.

Meaningful rehabilitation opportunities for the homeless community.

Services and housing centrally located for the homeless.

Blighted buildings could be reactivated and repurposed.

Also, just as important, homeless housing developers say Project Homekey reduced the time and cost of creating housing for the homeless. Building low-income housing from scratch in a city like Sacramento can cost over $500,000 per unit and take two years to complete because of exorbitant property and construction costs.

Because Project Homekey properties already exist and just need some light renovation before people move in, the construction costs and completion timelines of homeless housing projects are slashed by well over 50% compared to traditional homeless housing developments. The average cost of Homekey housing should come in around $147,000 per unit.

Benefits of Homekey Transactions for Hospitality Owners: Certainty of close: Local municipalities are eager to find solutions to house their homeless population. Project Homekey provides the financial wherewithal to finally address this need. Often times where public / private real estate deals fall apart is identifying the sources of funding for a public agency to successfully close escrow on a property. Project Homekey removes this hurdle and incentivizes the agency to close and close relatively quickly.

Valuation: Because each public agency has had a “shot in the arm” with funding, property owners will likely benefit financially by selling their property to a public agency because of the increased competition for hospitality assets in California.

Turton Commercial Real Estate (our firm) has spent a combined thirty years of experience negotiating public agency real estate transactions. We’ve helped out El Dorado County, Placer County, Sutter County, the City of Sacramento, the City of Davis, the City of Elk Grove, the Government of Mexico, Sacramento Regional Transit and many others. Our team can advise you on how to best structure your property for a successful sale under Project Homekey.

How it plays out in real life: This is a case study of Sutter County’s purchase of the Baymont Motel on Sawtell Avenue in Yuba City.

Sutter County recently purchased a 62-room hotel (with representation from Turton Commercial) using funds from a $6.7-million-dollar grant from Project Homekey project toward a total purchase price of $7.2 million. The property will then be turned over to Habitat for Humanity Yuba-Sutter, while Hands of Hope will administer the project.

Habitat for Humanity of Yuba-Sutter will work with Hands of Hope in Yuba City to administer the permanent housing solution and provide a variety of services to assist homeless individuals in retreating from the insecurity of the river bottoms and the streets into the security of four walls and a locked door. The agencies will work closely with Sutter County Health and Human Services Department, but the operation will be entirely under the umbrella of Habitat for Humanity.

“This is not a homeless ‘shelter’,” CAO Smith pointed out when the Board of Supervisors voted 5-0 on August 11 to submit the grant application to the California Department of Housing.

“This will be affordable housing targeting those with a history of homelessness operated by an agency whose mission is to house people.”

1100 11th Street

unmatched opportunity available for sale: 1100 11 th street office + retail - $10.5 M - 24,776 SF

1130 K 916.573.3300 | TURTONCOM.COM

SCAN FOR PROPERTY 629-168,019 SF OFFICE SPACE FOR LEASE 1 BLOCK FROM THE STATE CAPITOL REMODEL AND ADDITION UNDERWAY AND TO BE COMPLETE APRIL 2022

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A new face in the development community we should all welcome!

ISSUE 9

JON LANG - VICE PRESIDENT

AND NOW, SOME QUESTIONS WITH

KEVIN KHASIGIAN K

Kevin Khasigian is a modern-day renaissance man, with his business ventures spread across law, hospitality, and real estate development. We asked him a few questions so you can get to know this new heavy hitter!

F A L L 2 0 21

Describe “Midtown” Janky, eclectic, on the rise, and under the radar.

Favorite building in the urban core (not one of your buildings)?

Memorial Auditorium. I get chills every time I walk inside.

Best late night eats in the urban core?

Pieces Pizza on 21st Street!

Development you are most proud of and why?

The “Southsider” at 10th and U Streets because it highlights Southside Park, a neighborhood that is gaining momentum, and what I think is the best neighborhood in the entire urban core.

Most interesting case you handled at US attorneys office?

The seizure and prosecution of AlphaBay, the largest online “Dark Market” used to buy and sell illegal goods and services around the world.

All: After prosecuting complex criminal cases with the U.S. Attorneys office for over a decade, he stepped back to pursue his passions in food, coffee, design, and construction. Now the owner of the Naked, Tupelo Coffee brands & Doughbot, he’s working to expand their footprint and wholesale distribution throughout Northern CA. He also leads day-to-day operations for HK3 Development, a progressive infill development group.

What common skill do you need to practice law, operate coffee shop, and develop real estate?

Punctual decisiveness – being patient until it is exactly the right moment to make a critical decision.

Advice for anyone wanting to develop real estate in the urban core?

Get prepared for cost overages and time delays.

Why/How did you get into coffee and doughnuts?

I’ve always wanted to go vertical on things I’m passionate about like consumer demand, design, and food. Coffee and doughnuts allow me to do just that.

Hobbies outside of work?

Running marathons, horticulture, and agriculture (I grew up on a farm).

What new developments are you working on?

Mixed-use project in Newton Booth, which includes 38 residential units and ground floor retail.

How many hours do you sleep each night?

From 1am to 5:30am, so generally about 4.5 hours. I try to beat all my employees into the coffee shop each morning.

Where do you see Sacramento in 10 years?

Considered one of the four major cities in California along with Los Angeles, San Francisco, and San Diego!

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If y ou ha ven’t hea rd of us, get wi th the ti mes !

T U R T O N C O M M E R C I A L R E A L E S T AT E

ABOUT OUR FIRM We are a boutique firm made up of fresh agents and creative marketers with a passion for Sacramento. We tore down those divisive office walls and created a collaborative work environment where all information is shared to benefit our clients and their

real estate. We recognize tradition, yet embrace the future.

Whether tenant or landlord, buyer, or seller, we combine industry knowledge, know-how, and resources with creativity, hard work, and a relentless passion to beat client expectations. Contact

us anytime to discuss the perfect property for your firm or how to maximize the value of your own property. Interested in learning about the market or working for Turton Commercial? Let’s grab a coffee at Temple or a beer at LowBrau. Our treat.

ISSUE 9 F A L L 2 0 21

PRESIDENT

KEN TURTON

Lic. 01219637

916.573.3300 | kenturton@turtoncom.com

Aaron and Patrick rolling up to LowBrau in their usual fashion.

VICE PRESIDENT

Patrick catching up on his cold calls while on his commute to work.

VICE PRESIDENT

SENIOR DIRECTOR

DIRECTOR

AARON MARCHAND

Lic. 01711650

916.573.3305 | aaronmarchand@turtoncom.com

JON LANG Esq.

Lic. 01934934

916.573.3302 | jonlang@turtoncom.com

SCOTT KINGSTON

Lic. 01485640

916.573.3309 | scottkingston@turtoncom.com

PATRICK STELMACH

Lic. 01964999

BROKERAGE

VICE PRESIDENT

916.573.3314 | patrickstelmach@turtoncom.com

DAVID KHEDRY

Lic. 02063469

916.573.3303 | davidkhedry@turtoncom.com

Matt & Scott jumping because they saw a spider.

DIRECTOR

MATT AXFORD

Lic. 02124801

916.573.3308 | mattaxford@turtoncom.com

DIRECTOR

JACK SCURFIELD

Lic. 02127988

916.573.3316 | jackscurfield@turtoncom.com

VP OPERATIONS & MARKETING CREATIVE DIRECTOR

MARKETING ASSOCIATE

© 2021 This information has been secured from sources believed to be reliable. Any projections, opinions, assumptions or estimates used are for example only and do not constitute any warranty or representation as to the accuracy of the information. All information should be verified through an independent investigation by the recipient, prior to execution of legal documents or purchase, to determine the suitability of the property for their needs. Logos and/or pictures are displayed for visual purposes only and are the property of their respective owners.

MELODY JONES

Lic. 01296376

916.496.1527 | melodyjones@turtoncom.com

BROOKE BUTLER

Lic. 02086576

916.573.3301 | brookebutler@turtoncom.com

COREY LAU 916.573.3304 | coreylau@turtoncom.com

JUSTINE WONG

M A R K E T I N G / O P E R AT I O N S

VP PROP. / PROJECT MGMT.

916.573.3304 | justinewong@turtoncom.com

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