A local investor has paid $10 million for a renovated building in Downtown Palo Alto occupied by an outgoing Restoration Hardware store.
Peter Pau, founder of Sand Hill Property based in Palo Alto, bought the 15,000-square-foot building at 281 University Avenue in Downtown North, the Silicon Valley Business Journal reported. The deal came out to $667 per square foot.
The sellers, a group headed by an unidentified local family trust, tried to sell the building for as much as $14 million.
Restoration Hardware, which spent between $3 million and $5 million to renovate the building, is expected to relocate this year to a flagship store at the nearby Stanford Shopping Center, according to a broker who arranged the deal.
The single-story building at Bryant Street includes 7,500 square feet of ground-floor retail and 7,500 square feet of basement.
Pau and Sand Hill Property are betting on a retail recovery with plans to find a new tenant for the building.
Sand Hill Property, a real estate development and investment firm founded in 1988, has invested in more than 65 projects totaling 20 million square feet in Silicon Valley, from stand-alone retail stores to multi-use city centers, according to its website.
It expects to break ground soon on a $4 billion redevelopment of a former mall in Cupertino, where it plans to build a retail village of 2,400 homes, half of them affordable, with nearly 2 million square feet of offices, labs, shops and restaurants.
Sand Hill is also working to redevelop a shopping center in southwest San Jose into a 167,000-square-foot, mixed-use project with nearly 1,000 apartments, of which 150 would be affordable.
– Dana Bartholomew
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