Archives for July 2006

Borelli Investment Co. Leads Team Effort to Keep Approximately 175 Jobs in San Jose

Borelli Investment Co. Leads Team Effort to Keep
Approximately 175 Jobs in San Jose

Business and government cooperation results in clean approval for the sale of a warehouse used for textile rentals and commercial laundry services in North San Jose industrial park area.

San Jose, Calif., July 11, 2006 — The owner of a 53,760 square foot warehouse on Junction Avenue in San Jose was ready to move. Part of a national company that specializes in uniforms and other branded identity apparel programs and services, managers of the local facility felt the time was right to relocate its operations to another building in San Jose.

Brokers from Borelli Investment Company quickly identified a potential buyer—Alsco. Alsco is a global leader in a similar line of business, with service centers in more than 120 locations and ten countries worldwide. Every day, the privately owned company picks up, cleans and delivers millions of flat linens, uniforms, chef’s outfits, cleanroom garments, dust control items, and more. Equipped with a Class One clean room—and located near Highways 880, 101, and 680, as well as Mineta San Jose International Airport—the building was a perfect location for Alsco’s proposed San Jose service center.

The challenge was the transaction needed to close quickly. And posing a major obstacle was the fact that the City of San Jose had rezoned the area around the warehouse for industrial park uses. This made the textile rentals and commercial laundry services performed in the warehouse a nonconforming use under the city’s code.

“Obviously, the existing business could continue to provide its services after the rezoning, as long as it occupied the facility,” explained Tom Zolezzi, one of two brokers from Borelli Investment Company who worked on the transaction. “But to facilitate the sale to Alsco, we needed to get a ruling from City of San Jose Planning Department that because Alsco’s operations would be nearly identical to the selling party’s, this was a legal, nonconforming use.”

Dealing with the Spin Cycle

At first, the challenges appeared to be difficult, with much uncertainty spinning around the sale. Business timetables for both Alsco and the seller required a short contingency period and quick close. If that did not occur, both businesses would be forced to seek alternate sites outside of San Jose, costing the city the 75 jobs at the present facility, plus 75 to 100 jobs at the new San Jose facility the seller planned to occupy.

The initial reading of the zoning ordinance from the City of San Jose Planning Department caused timing concerns—with the department requesting 30 to 45 days or more to review the application before issuing a decision that might or might not allow the sale to proceed.

But Tom Zolezzi and Chris Anderson of Borelli Investment Company—along with Gerry DeYoung from planning and engineering consultant Ruth and Going—worked closely over a very short timeframe with the staffs of both the City of San Jose Redevelopment Agency and the San Jose Planning Department, and a solution was found.

“With everyone on the same page, we were able to address the San Jose Planning Department’s concerns and prove that Alsco’s business represented a legal, nonconforming use,” said Zolezzi. “Contingencies were removed, and escrow proceeded, with the transaction closing on May 19th. We negotiated a good price for Alsco, and met both companies needs to move in a timely manner.”

The transaction involved not only the Junction Avenue warehouse with its nine dock doors, two grade-level doors, clean room, and large parking and truck area—but also 5.32 acres of prime land in North San Jose, perfect for future expansion, if needed. Selling price was approximately $5 million.

“The city’s vision and cooperative efforts accelerated the process and ensured we could meet Alsco’s timetable,” Zolezzi remarked. “This truly saved the 150 to 175 jobs that would have gone elsewhere, making it a clean win for the City of San Jose, as well as the buyer and seller.”

View Alsco Corporate website
Having celebrated its 50th anniversary last year, Borelli Investment Company is one of the oldest commercial real estate firms in the Santa Clara Valley.  The company provides a full range of commercial real estate services-from development and construction management to land sales and consulting for sales and leasing. More information about Borelli Investment Company’s services may be obtained by calling (408) 453-4700 or visiting www.borell-inv.com.

Contact: Ralph Borelli, CEO Borelli Investment Company 1770 Technology Dr. San Jose, CA 95110 Ph: 408.453.4700 Fax: 408.453.4636 E-mail: ralph@borelli.com

http://www.borelli.com

Borelli Enters Strategic Alliance with GD Commercial Real Estate

Borelli Enters Strategic Alliance with GD Commercial Real Estate

GD Commercial named the exclusive broker to the Asian marketplace for
hot business condominium category.

San Jose, Calif., July 6, 2006 — Borelli Investment Company, a long-time leader in commercial real estate services and a pioneer in the development of business condominiums in Silicon Valley, has announced that it has entered a strategic alliance with GD Commercial Real Estate to market its business condominium projects to the Asian marketplace.  The exclusive marketing agreement with GD Commercial covers two current Borelli business condominium projects — AirTech Office Condominiums, at 1754 Technology Drive in San Jose, and Junction Office Center, at 2051–2055 Junction Avenue in San Jose.

“Business condominiums have been a very hot category in Silicon Valley for several years,” said Ralph N. Borelli, chief executive officer of Borelli Investment Company. “The Asian community has shown a strong interest in our product from the beginning. We decided it was time to formalize our marketing efforts to this community, and when we were searching for a strong partner that knew the market, the GD Commercial name kept coming up.”

Borelli Investment Company and GD Commercial will work together to develop collateral material, web sites, and advertising in several Asian languages for Borelli’s existing business condominium projects. GD Commercial has well-established contacts not only in the Bay Area, but also with business owners and investors in China and other Asian countries, who want to open operations in the U.S.

View San Jose Mercury News article about this strategic alliance.

“There is a significant amount of interest in China right now in expanding to dynamic U.S. markets such as Silicon Valley,” explained John Luk, executive managing director of GD Commercial. “We have established relationships both here and overseas that we think can work to both Borelli’s and our benefit. Borelli develops high-quality business condominiums, available in spaces as small as 750 square feet. That makes its properties very marketable.”

AirTech Office Condominiums is a two-story garden office building with 40 office condos totaling 55,870 square feet. Borelli invested $3 million in the conversion and upgrade. Amenities include high-speed Internet access, a common conference room with large video screen, individual heating and air conditioning controls, full carpeting, and coffee bars in each suite. Down payments start as low as $41,000 — with only four suites left to sell.

Junction Office Center is a two-building, two-story office complex in North San Jose’s Golden Triangle. The 77,404 square feet of space is divided into 52 offices. Tenants and visitors enter through formal lobbies with polished granite floors and high ceilings. Amenities include carpeting and coffee bars in each unit, a common conference room with large-screen video, T1 fiber optic cable for high-speed Internet access, and showers in the bathrooms to use after a run or bike ride. Borelli invested nearly $10 million in the Junction conversion. Down payments start as low as $27,900.

“With rents beginning to rise, ownership makes a lot of sense now for businesses or professional practices of any size,” Borelli remarked. “Owners can lock in occupancy costs, and enjoy tremendous tax advantages and the potential for long-term appreciation. It really doesn’t make sense to lease if you can own.”

“We look forward to working with Borelli to market these two outstanding projects, and then continue to explore other projects in the future that provide mutual benefits,” Luk added.

Borelli Investment Company is one of the oldest commercial real estate firms in the Santa Clara Valley, with more than 50 years of experience. The company provides a full range of commercial real estate services—from development and construction management to land sales and consulting for sales and leasing. More information about Borelli Investment Company’s services may be obtained by calling (408) 453-4700 or visiting www.borelli.com.

GD Commercial is a leading, partner-owned US commercial real estate company comprised of real estate professionals including licensed brokers, financial analysts, research professionals, and marketing specialists. The company’s range of services includes office, industrial and retail leasing; tenant representation services; property acquisitions and dispositions; corporate advisory services; mortgage financing; and consulting and research. Visit www.gdcommercial.com or call (800) 939-8168.

Contact: Ralph Borelli, CEO Borelli Investment Company 1770 Technology Dr. San Jose, CA 95110 Ph: 408.453.4700 Fax: 408.453.4636 E-mail: ralph@borelli.com

 

http://www.borelli.com

GD Commercial RE and Borelli Forge New Links

Forging New Links

Asian-American broke represents a shif in valley’s business property marketplace.

By Katherine Conrad, San Jose Mercury News, July 4, 2006

Commercial broker John Luk, the force behind San Jose’s Pacific Rim Shopping Center and the Bay Area’s largest Asian marketplace, Milpitas Square, now has a new focus: selling business space to the Asian community.

In a deal he struck with San Jose-based Borelli Investment, Borelli builds the office condominiums and Luk finds the buyers. They are chiefly Silicon Valley professionals who like doing business with people they know, who would rather own than rent their offices, and who tend to be Asian.

A Chinese-born American, Luk represents a shift in local commercial real estate, a lucrative business that still relies heavily on inside knowledge and trust. Brokers typically have been white.

Now that’s beginning to change, as Silicon Valley’s diverse entrepreneurs play a growing role in the office market. Developers who want to sell to small businesses need a conduit.

“We don’t speak the lingo,” said Borelli, who leads one of Silicon Valley’s oldest commercial real estate and development firms. “And we hope to sell the condominium units faster.”

Luk, who speaks Mandarin, is one of just a few Asian-Americans selling commercial real estate full time in Silicon Valley, others in the broker community said. He has been carving a niche for himself since he opened GD Commercial Real Estate in Milpitas three years ago.

It seems a likely endeavor for the man, who sees himself as a builder of bridges between cultures, communities and even continents. Asians believe strongly in property ownership and know how to pool their resources, he said, but they need a broker to help guide them through the process.

“We deal with every buyer,” he said. “The big boys don’t take time to respond to the small guys — we are the small guys.”

Though there are many Asian-Americans in the residential real estate industry, commercial real estate has attracted few Asians, said Olivia Jang of California Best Investment Realty in Cupertino.

“I know John Luk,” Jang said. “I know him, since in the Chinese community, there’s not so many commercial agents. There’s only him, me and a few ABCs — that’s what we call American-born Chinese — a few younger guys.”

Jang said the commercial side is a tough field to break into, especially if you don’t fit the stereotype.

“Most commercial agents are white males,” she said. “So for the Chinese, even the first generation born here, it’s not so easy to get into this field. Commercial real estate is hard, it’s more complicated and you need more knowledge.” For example, she said, there are no easily accessible listings for office properties, as there are for homes. Brokers have to rely on connections to get business.

Luk, who came to the United States in 1975 as a nurse, broke into the industry while caring for flower growers in the emergency room. Many could not speak English, so Luk was their interpreter.

He discovered that they needed help, first to negotiate better business deals for fertilizer and seed and then to sell their property, as their fields of flowers made way for development.

Three years ago, he decided to launch GD Commercial, where 15 brokers with roots in China, Vietnam and India work to serve Asian investors. Depending on Luk’s mood, the GD in the name either stands for global domain or good deal.

Luk expects the strategic alliance he has formed with Borelli Investment will take his firm to the next level. Luk is already marketing the commercial condos to the Asian-American community here. But his ambitions extend all the way to China, where he recently opened an office in the southern city of Guangzhou to encourage Chinese investors to buy a piece of America.

In the next few weeks, Luk said, 10 Chinese investors will tour Borelli’s condo projects in Ringwood Business Center and Junction Office Center.

The Borelli name ought to be fairly well-known among Asian-Americans, since two-thirds of his condo buyers are either Asian-born or of Asian ancestry, Borelli said. But now that interest rates are rising, leading to a slowdown in commercial condo sales, he is interested in finding new buyers for his product.

“There’s 1.3 billion people in mainland China and 1 billion people in India, and a big segment want to come to the United States,” Borelli said.

Under a program Congress established in 1990, called the EB-5 visa, an investor willing to invest $1 million and hire 10 employees in this country can get a green card after about a year.

“It is a lot of work to be the bridge,” Luk said. “But China is the largest-growing economy in the world. Why not have them come and do business in San Jose?”

Borelli, Luk said, does not know China, but he knows the Asians are valuable to his business.

Borelli isn’t the only one. Danny Yu, a commercial broker with NAI/BT Commercial, said he, Tenny Tsai and Jim Kovaleski, all BT brokers, went to China in November to check out investment opportunities.

“The economy in China is growing and a lot of individuals are making money,” said Yu, a broker since 1983. “They like to invest outside the country. There’s still a trust issue between them and their government. The rules are changing every day and they don’t know when the government will flip.”

As Luk said, “There’s a lot of millionaires in China and most of the billionaires are in their mid-30s and early 40s. The timing is getting closer and closer to encourage them to go out of their country and internationalize. This is the land of opportunities and the land of immigrants.”


Contact Katherine Conrad at kconrad@mercurynews.com or (408) 920-5073.