As we celebrate another banner year of commercial real estate with the 26th annual Broker of the Year awards, we also should take note of some of the accolades recently bestowed upon our fair city: Top “Game Changing” Northern California City: Sacramento (Sunset Magazine, February 2018); America’s stealthy farm-to-fork capital (Thrillist, January 2018); Ranked 5th on the Forbes list of best cities for job seekers (Forbes, May 2017), beating out every other California city. Bloomberg News recently noted a “flood” of San Franciscans seeking less expensive housing into Sacramento, which has contributed to both Sacramento’s multi-family rent increases (the 2nd highest percentage increases in the nation, just behind Tacoma, Washington) and a rise in housing costs (which costs rose 10% compared to 2016 prices). We even had an academy award nominated movie, “Lady Bird”, which featured our fair city. (We were beaten out by a movie about a fish! Go figure.) The Wall Street Journal called Sacramento “California’s Newest Real-Estate Hot Spot” (WSJ, May 2017), proclaiming that “Sacramento, Calif., long seen as a fairly bland government town, is in the midst of a real estate boom.”
So, what has caused all of this “buzz”? Certainly, the development of the Golden 1 Center and “DoCo” (including the uber hip Sawyer Hotel) was a major catalyst, but Sacramento also has bevy of other “cool” and “hip” projects that make national investors stand up and take notice, including the Ice Blocks project by Heller Pacific, with its heavy timber construction; the new B Street Theatre at the Sophia, which was financed through a $29 million public-private partnership with the California Infrastructure and Economic Development Bank; and the Barn in West Sacramento and the Milagro Centre in Carmichael with their unique designs and concepts. Centene Corporation, one of the largest health care companies in the country, executed a 175,000 square foot lease in Rancho Cordova in 2017 (one of the largest in the Sacramento area last year), and is contemplating a headquarters site in North Natomas, all of which will bring much needed high paying jobs to the Sacramento region.
Aside from retail, office and industrial development, Sacramento real estate is thriving in arts and tourism as well. In addition to the new B Street Theatre at the Sofia, the City of Sacramento will soon invest about $189 million in renovations and expansions of the Sacramento Convention Center, Memorial Auditorium and the Community Center Theater, all of which will continue to bolster Sacramento as a tourism and arts destination. Adding to the enthusiasm for Sacramento is the future development of the Railyards, the largest infill project in the United States.
All of the above translates to an excitement and energy that is palpable, and promises to result in increased interest in Sacramento commercial real estate for years to come. Stewart Ward & Josephson is proud to be an integral part of serving the commercial real estate and banking community, and to have participated in the growth of this great city, by representing many of the principals in the projects previously mentioned. We congratulate all of tonight’s award recipients, and look forward to another exciting year in commercial real estate for 2018.