B e e r: W h i t t a k e r A l e a t D e r B i e r g a r t e n
S ACR A MEN T O COMMERCIA L RE A L E S TAT E, DE V ELOPMEN T, A ND CULT URE
06
Should I invest in commercial real estate or stocks?
ISSUE FOUR
13
Confusing industry terms, finally clarified!
32
Beer spots mapped by brand - for your convenience!
TURTON
WRIT TEN, PHOTOGR APHED, AND DESIGNED IN-HOUSE BY THE TURTON TE AM
AUTUMN 2018
275,363 SQUARE FEET OF SPACE. 45 NEARBY AMENITIES.
INFINITE POSSIBILITIES. 1631 ALHAMBRA BLVD
916.573.3300 - T URT ONCOM.COM
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A f ew not es, sc ribbl es, a nd mus i ngs b efore we b egi n.
SEPTEMBER 2018
CONTENTS Just when you thought we couldn’t produce another issue! Midtown Etiquette
04
Happy Hours Worth Imbibing In
06
CRE vs. Stocks
09
Location & Brand
13
Glosssary of CRE Terms
INDUSTRY HUMOR So, You Wanna Be a Broker?
Glosssary of CRE Terms
Managing High T.I. Costs
Location & Brand Multifamily Rent Heat Map
14
Midtown Etiquette
17
Multifamily Rent Heat Map
19
So, You Wanna Be a Broker?
20
JUMP Bikes: Pretty Groovy
24
What is Gentrification?
30
Managing High T.I. Costs
32
Beer Spot Brand Plot
35
An Interview With Mike Jasso
MOVING MONEY
NEW THINGS
What is Gentrification?
JUMP Bikes: Pretty Groovy Beer Spot Brand Plot CRE vs. Stocks
An Interview With Mike Jasso
ENJOYING LIFE Sac’s Happiest Hours
Another Groovy Playlist From the Turton office! Here at the Turton office, we take our jams pretty seriously. Here’s an ecclectic indie/ house/nu-disco playlist put together by DJ Mudge, our in-house mixologist.
Crumb - Locket Cath Coffey - SWIMSWIMSWIM MNDSGN - Just Air Electrelane - I Want to be the President
The Babe Rainbow - Monky Disco LCD Soundystem - Losing My Edge Jesse Rose - Heavy Still GEMS - Never Age
The Chemical Brothers - Got Glint Chinese Man - Indi Groove 1-800-GIRLS - U, Me, and Madonna Jazz Spastiks - (Never Been To) California
A SHORT STORY FROM
TURTON
KEN TURTON
T U R T O N CO M .CO M 916.573.330 0
24 0 9 L S T R E E T, S T E 2 0 0 , S A C R A M E N T O , C A 9 5 816
The coffee and alcohol set off an internal alarm, but when I saw Melissa carefully eyeing the two-ply toilet paper I had to draw the line. I placed the pen gently on the kitchen table and said, “I think we’re approaching this from the wrong direction. Rather than focusing on cutting expenses, perhaps we should focus on increasing revenue.â€? Indeed, after cutting every conceivable monthly expense we wound up saving about $600 per month. We would live in stark misery but would put away an additional $7,200 per year before taxes. 45 days later we began new careers. I became a “runnerâ€? at CB Richard Ellis, now CBRE and Melissa began a career in medical diagnostics. Twenty-one years later we could retire if we wanted to. At TCRE, we meet with businesses every single week highly focused on saving money on their real estate expenses. “How can we reduce our costs by $.10 per sf?â€? or, “How can we reduce our improvement costs by $20,000?â€? Operating a business prudently is important. Very important. Believe me, we are very cost conscious at Turton Commercial. It’s expensive to run a business in California. But we also understand it is far more important to focus on generating revenue. It is much, much more beneficial to increase your revenue by $500,000 than to save $25,000 in rent and improvement costs. Today, we train all our agents to help our clients utilize their commercial real estate as a revenue generating asset. Use your location and interior design to build your brand, establish your culture, retain best-in-class employees, and attract more clients. Successful businesses have great histories and compelling stories. Let your real estate tell that story. A picture is worth a thousand words, remember? Your space is much more than a picture. This is exactly what we do at Turton Commercial. We don’t just talk the talk. We walk the walk. We invest our capital into our real estate resources to generate more revenue and it has always paid dividends - exponentially. And, yes, we have two-ply toilet paper. đ&#x;˜Š KEN TURTON - PRESIDENT
916.573.3300 | KENTURTON@TURTONCOM.COM VICE PRESIDENT
VICE PRESIDENT
VICE PRESIDENT
SENIOR DIRECTOR
DIRECTOR
AARON MARCHAND 916.573.3305 | AARONMARCHAND@TURTONCOM.COM
JON LANG 916.573.3302 | JONL ANG@TURTONCOM.COM
SCOTT KINGSTON 916.573.3309 | SCOTTKINGSTON@TURTONCOM.COM
JOHN MUDGETT 916.573.3306 | JOHNMUDGET T@TURTONCOM.COM
BROKERAGE
Downgrade satellite television package, save $50. Set the air conditioning to 76 and the heat to 64, save $35. Switch car insurance from AAA to Geico, save $50. Eliminate gym membership, golf, and movies, save $175. Eliminate restaurant dining, save $150. Switch the dogs food from “Supreme� to “Mediocre,� save $50. Eliminate coffee and alcohol, save $100.
KEN TURTON
PATRICK STELMACH 916.573.3314 | PATRICKSTELMACH@TURTONCOM.COM
DIRECTOR
SEAN TOOKE 916.573.3313 | SEANTOOKE@TURTONCOM.COM
DIRECTOR
ZACHARY HOOKER 916.573.3315 | ZACHARYHOOKER@TURTONCOM.COM
ASSOCIATE
GRAHAM HONIG 916.573.3308 | GRAHAMHONIG@TURTONCOM.COM
VP OPERATIONS & MARKETING
CREATIVE DIRECTOR
MARKETING ASSOCIATE VP PROPERTY MANAGEMENT
SENIOR DIRECTOR
BROOKE BUTLER 916.573.3301 | BROOKEBUTLER@TURTONCOM.COM
COREY LAU 916.573.3304 | COREYL AU@TURTONCOM.COM
BRITTA SWANSON
M A R K E T I N G / O P E R AT I O N S
• • • • • • •
PRESIDENT
916.573.3304 | BRIT TASWANSON@TURTONCOM.COM
MELODY JONES 916.496.1527 | MELODYJONES@TURTONCOM.COM
NICOLE CLANCY 916.546.0334 | NICOLECL ANCY@TURTONCOM.COM
Right: A mural at 2010 K Street by Nate Frizzell.
PROJECT / PROPERT Y MGMT
It was early one Saturday morning in December of 1996 when my wife, Melissa, and I sat down over coffee and decided to map out our retirement plan. We were making ends meet financially but we weren’t really putting away any meaningful money that would allow us to stop working for a living at an age where we would truly enjoy our freedom. It was time to get serious, we declared! It was time to cut monthly expenses! Trim the fat; eliminate waste; live frugally!
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Sac rament o is an oas i s of li b a ti ons to s a ti s fy a ny ta s te - even yo u rs, w h ic h is apparen t l y q u it e as t u t e .
A SAM P LI N G O F SACRAM ENTO’ S
HAPPIEST HOURS SEAN TOOKE - DIRECTOR
J 1
Just as you wrap up that extra-long workday, you begin to lament the looming tasks tomorrow - but fear not! Sacramento is a city brimming with drink specials! From classic artisan cocktails and locally-aged wine to some of the craftiest craft brews in the nation, Sacramento’s happy hours have everything you need to take the edge off for cheap and make it to the weekend. Here are my favorite cocktail happy hour spots.
Ella Dinning Room
12th and K
Located on Sacramento’s up-and-coming K Street, this contemporary restaurant of New American and French cuisine is serving up the classiest of cocktails and pairings for happy hour. From the savory Blistered Shishito Peppers and a Randal’s Harvest Margarita to the Steak Tartare and an Ella Manhattan, Ella is a sure place to impress new clients with elevated taste.
2
Firestone Public House (soon to be renamed)
16th and L
Situated in the middle of the urban core, Firestone boasts a bastion of local beers on tap, wall to wall TV’s and one of the most lively and fresh atmospheres in town. What sets this place apart from the rest of the typical happy hour? Late night happy hour for those of you who find yourself staying late at the office. Stop by and grab a brew, watch the Kings win the game [ha], and let the thought of your jay-oh-bee melt away.
3
Paragary’s Midtown
28th and N
For those looking for more than the usual bar has to offer, this eclectic neighborhood spot is the place to hide away in. Paragary’s Midtown (a Midtown staple since 1983) is serving up some of the absolute best cocktails, wine, drafts and rare spirits all day from 4pm to closing time on Mondays. Combine those libations with a delicious brick and wood fired oven pizza or mussles and you have a recipe for relaxation.
4
Punch Bowl Social
Kimpton Sawyer Hotel – Downtown Commons (DOCO)
This place is big - really big! If you like your happy hour with a side of bowling, virtual reality gaming, old school arcade games, karaoke, corn hole, and a plethora of other activities, then Punch Bowl in the Sawyer Hotel is the best watering hole for you. While the drink offerings for Punch Bowl may be a bit more main-stream than the eclectic establishments in Midtown, the activities and food is what make this place extraordinary.
5
Zocalo Cocina Mexicana
18th & Capitol
What would this world be if Carlos “Danny” Herrera hadn’t mixed up the “Daisy” in 1938 and started a revolution in cocktails that would grace happy hours from coast to coast for decades to come? Yes, I’m talking about the Margarita! If this popular tequila cocktail is what you seek to wipe away the work day, then Zocalo Midtown has some of the best around. From Blackberry, Strawberry Basil to Mango Fresco and a plethora of flavors, this Cocina Mexicana has everything you need to “foggeddabout” it.
O t her gr eat
Eats! Drinks &
F O R E A C H DAY O F T H E W E E K
Each new day brings chirping birds, cool morning air, and a new set of happy hours to choose from! MONDAY: Kupros: Happy hour 3:00 PM - closing Badlands: Industry members 50% off all drinks TUESDAY: Jalepeños: 99¢ tacos all day Chando’s: $1.50 tacos, $4 margaritas Orchid Thai: All day happy hour, $4 wells Goldfield Trading Post: $1 tacos all day Blue Cue: $2.50 Crown Royal Shots El Rey on K: $2 Tacos $3 tequila Azul: Taco Tuesday MIX: Taco Tuesday Highwater: $2 beers, $2 jello shots, $3 wells WEDNESDAY: R15: 6 wings for $3 from 5:00 PM - closing Easy on I: All day drinks happy hour Badlands: $1 wells de Veres Irish Pub: ½-price whiskey 9:00 PM - closing Sauced : $4 margaritas Fannie Ann’s Saloon [Old Sac]: 1 lb of wings for $6.99 THURSDAY: Lucca: Happy hour 3:00 PM - closing The Depot: $3.00 Long Island Iced Teas MIX: All-day happy hour SUNDAY: Press Club: Funk / Psychedelic Night, varying deals The Depot: $3.50 Pitchers Kupros Craft House: Clear the Keg Night, $4 craft beers Capitol Garage: Bottomless mimosas until 3:00 PM
Top: The insanely good Mango Fresco Margarita at Zocalo Cocina Mexicana in Midtown.
CREATIVE OFFICE SPACE 916-573-3300 TURTONCOM.COM
HELLER PACIFIC
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C ommerc ial bu il dings a re a generous s ource of i ncome.
I N VES TM E N T S TR ATEGIES:
CRE VS. STOCKS JOHN MUDGETT - SENIOR DIRECTOR
There are plenty of articles debating whether someone should invest in real estate or the stock market. The argument is typically presented as an either-or to generate interest, but the truth is that you need both. Expert opinion conservatively allocates around 10% of one’s portfolio for real estate related investments, however there are new studies that demonstrate higher allocations of 2026% will offer higher gains and additional portfolio protection through diversification. The time needed to accrue capital for real estate investment can be daunting. As a result, many folks shy away from real estate outside of their primary residence and focus on stocks.
ON INVESTMENTS In 16 Now-Wealthy Economies, 1870-2015 Which investment is safer: real estate or stocks? A team of esteemed economists presents 145 years of economic data for your consumption! Source: ATLAS Data Jordan et. al. (2017)
7%
Average annual return (inflation adjusted)
6% 5% 4% 3% 2%
LS BIL AS.
TRE
BON DS
ITIE
S
1%
EQU
As a category, real estate investment is associated more commonly with fixed income investments and known for methodical and conservative returns. For this reason it has lagged behind the equities market. Why would someone want to purchase a commercial real estate investment with a return ranging between 6-10% when the stock market is generating 1020%? Due to this disparity in returns, com-
An investment with a long lease and a strong tenant will continue to generate cash flow through a downturn. Real estate’s long cycle also provides protection from the risks of inflation. When your rental properties have a good year, you can invest more in stocks. When your stocks have a good year, you can invest more into rental properties by either purchasing more property, paying down mortgages or making improvements. The ultimate goal is a well-diversified portfolio that will generate cash flow and appreciation. As your portfolio grows, you will have more cash flow to reinvest. But it starts with taking that first step into real estate ownership and investment.
RETURNS
EST ATE
REAL ESTATE When you invest in real estate, you are buying physical property and/or land. Commercial real estate generates cash flow through lease income. The investment type ranges widely to include apartment buildings, NNN retail investments, shopping centers, office buildings, parking lots, rental houses, industrial buildings, mixed use property, or infill development. The experts don’t invest for appreciation alone, so why should you?
mercial real estate has been somewhat insulated from the exuberance of the stock market and will act as a great hedge in coming years. The commercial real estate market has longer investment cycles that account for the planning and construction of real estate developments. Commercial lease terms with five or ten-year commitments will generate consistent income streams even during a downturn. With limited supply, long lead times, and high costs associated with new construction, it will take years to generate enough real estate to meet current demand.
REA L
STOCKS Stocks and equities offer fractional investments into businesses and those businesses generates income that eventually will make its way back to the investor in the form of dividends. The business may grow or contract in value, offering the investor a percentage of that gain or loss. Stocks can be less intimidating due to the size of the investment per share and the liquidity of the stock market compared to the larger purchase prices of real estate, even with the concept of positive leverage.
Top: Properly-positioned real estate assets are almost literally made of money.
Over $
540,000 per unit!
SOLD 1900 O STREET
TURTON COMMERCIAL - 916.573.3300 - TURTONCOM.COM
WP building
Ground lease/joint venture sale located in the epicenter of Midtown at 19J-19K!
Turton Commercial 916.573.3300 turtoncom.com
Midtown’s Next Big
Development Opportunity
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Re t a i le r s need t o c onsider t he b ra nd of thei r fi rs t loca ti on when expan d in g t o n ew o n e s.
F OR RE TA I LE R S , Y OUR BRAND IS AFFECTED BY
WHERE YOU ARE BROOKE BUTLER (MSc Marketing) - VP OF OPERATIONS & MARKETING
L “Location, Location, Location!” says everyone and their uncle. It’s common knowledge that location is a key factor for retailers. Weighing high visibility, pedestrian volume, and parking availability is a normal part of determining the right location for a business. But let’s go a step further and explore how a business’ location can be hugely influential in steering its overall brand identity.
“Ha! Wow. Based on the brands they identify with, these are undereducated suburban bros insecure about their masculinity. That certainly doesn’t fall in line with my personal brand as a progressive local urbanite insecure about how hip I am. I must be cool.” Bottom: Pressed Juicery chose to open a storefront at Ice Blocks, favoring the local vibe over the higher car traffic counts in other parts of the grid.
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We are what we buy.
We know that consumers are demanding more unique and satisfying retail experiences now. Social media has enabled customers to quickly exchange opinions and experiences of nearly every venue that exists. In turn, this has necessitated that retailers like restaurants, bars, and boutiques act as brands, curating their self-identity to show that they’re a worthwhile place to go. Identifying consumers’ motivations is a key aspect of positioning a brand towards the market.
Marketing researchers agree that consumers use brands to express and validate their identity, both to themselves and others. A term used by brand strategists is “self-concept” - the beliefs a person holds about their own attributes. Conceptualizing oneself inherently results in a perception of the actual self and an ideal self. Consumers often purchase products and services that help them reach towards their ideal self and boost their self-esteem.
Location and retail: an Instagram survey! Does the location of a restaurant or store contribute to how you perceive the establishment?
Would you go out of your way to shop / dine in an area that has the “vibe” you enjoy?
No No
Yes
Yes
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TH E N ATI O N AL C H AI N
UNDER I-80
The national chain is going to attract those on the go, likely not looking for a craft or artisan experience. Outside, the area’s noise, smog, and aura are uninviting to pedestrians. The interior design of the space is utilitarian and dated. While uninspiring, this works well for a large company targeting a wide swatch of the market and fast table turnover.
“Follow me into this unkempt alley to my secret pizza place. I promise you’ll think I’m really hip, urban, and generally cool for knowing of such a unique, off-the-beaten-path venue.”
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A retail brand is defined by its space / location.
A submarket, district, and even individual streets have their own connotations already associated with them. This affects how a retail establishment located there will be perceived and, subsequently, interacted with. A location can act as a point of parity with competition or be what sets a business apart from the rest. Association with Midtown contributes to a “coolness factor” that resonates with a young, educated market, but not all spots have the same vibe. Think Midtown pizza places. You have the Round Table on K Street under the freeway in a retail bay of a parking garage. Indoor seating only, but hey – decent lunch buffet. And then you have The Federalist, made of shipping containers beneath a rooftop garden tucked away behind a Victorian home in Matsui Alley. Often unrealized directly by consumers, these locations alone signal many different attributes about the businesses.
TH E LO C AL SPO T
IN THE ALLEY Top: The cozy interior space of The Federalist. Top right: The rough immediate surroundings of Round Table Pizza on K Street.
In contrast, the Federalist being nestled in a classic Midtown neighborhood with hidden alley access contributes to a brand perception of authenticity and exclusiveness. Inside the shipping container exterior are rows of rustic wood benches flanked by a wood-fired oven, bocce ball court, and bar serving craft brews. This spot has become a hidden favorite for local urbanites.
HOW WELL
DO YOU KNOW THE GRID? A TEST OF VISUAL RECOGNITION! Start at zero. Add or subtract points based on whether or not you can recognize the location of the image.
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(+10)
(-10)
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Her: “ Oh, what about Corporate Suburban Burgers? We’ve been there before.” Him: “Bah! Tonight, I chose to find a cool restaurant in the Hipster Factory District because I want to build my persona as an urban, groovy, with-it kinda guy, and that doesn’t really fit my criteria.”
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Retailers must consider their first brand when expanding.
Location becomes especially important when expanding to multiple locations. Consistency is key to avoiding brand confusion.
Old Soul Co. is a great local example of a retailer using a location to build their brand as “skilled roasters, artisans, and neighbors.” Old Soul was built on café culture and craftsmanship behind coffee roasting and their four locations signal these qualities to customers. They paired premium ingredients with down-to-earth and community oriented cafés at their first location in a charming alley of the Handle District. Their second location in Boulevard Park further demonstrates their neighborhood-friendly brand. And in Oak Park, they demonstrate their commitment to the community by livening a prominent corner in an up-and-coming area. It resonates perfectly with their target market – laptop toting, down-to-earth, eclectic creatives that desire authenticity and a connection to the community. This brand would not thrive in a suburban strip center set way back from the road behind a parking lot.
On the other hand, Dos Coyotes on R Street was not able to stay in business. The R Street Corridor has a reputation as one of the top restaurant and nightlife corridors in Sacramento – so why didn’t a restaurant like Dos Coyotes thrive there? Possibly because the industrial, gritty, hipster-chic R Street Corridor did not match their brand portfolio. Known for being an older chain, they reside in shopping malls and suburbs. Those visiting R Street are not looking for that experience, and converting the foot traffic to customers was an uphill battle due to the brand they had established over the past 25 years. This location may have failed partly due to the perceptions of their brand.
Bottom left: Old Soul Coffee in Liestal Alley exhibits an unpretentious urban vibe. Bottom right: That same vibe is present at their Weatherstone location at 21st Street and Historic Alley.
(+5)
(-20)
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(+35)
(-5)
QUIZ CONTINUED ON PAGE 29
HIGH VISIBILITY
LOW VACANCY
4 EYE-CATCHING SIGN COLORS AVAILABLE
Now with license numbers! (It’s the LAW).
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Le a r n more u nf amil iar or confus i ng i ndus try terms i n-p ers on b y m eet in g w it h a TCRE age n t f o r c o f f e e!
T HE C O M M E R C IAL REAL ESTATE
MINI-GLOSSARY JON LANG - VICE PRESIDENT
A collection of commercial real estate terms confusing to the uninitiated, finally clarified! 1 CRE
4 Mixed-use project
Acronym for Commercial Real Estate, which is any real estate purchased with the intent to derive a profit through annual revenues or longterm appreciation (that isn’t your own home). Buyer: “I’m going to purchase commercial real estate and make a lot of money… I heard its easy!” TCRE Agent: “Ha!”
2 Land banker Term used to describe buyers who purchase property (usually land) in urban markets and then do nothing to improve it. Often, they will create non-permitted parking lots and simply wait for the value of the property to increase as other developers invest and improve the surrounding neighborhoods. Owner of urban parking lot: “I’m not a Land Banker. If you find me a tenant for the entire building willing to sign a long-term lease based upon a 10% cap rate against all costs, including a land base of $250 per square foot, I will build the tower.” TCRE Agent: *whispering to coworker* “Definitely a land banker.”
3 Entitlements Government approvals for the rights to develop a property for a specific use. Often a long, drawn-out process that adds significant value to vacant land. Buyer: “I’m from Austin, Texas. I’m thinking 4 – 5 months to get entitlements.” TCRE Agent: *grinning* “Mmmmmm.”
7 Urban infill
Real estate that is concurrently occupied by a variety of tenants. Most commonly manifests as ground floor retail beneath office space or residential units. Used to activate neighborhoods with retail users, mitigate risk by diversifying the tenant mix, and maximize density. Buyer: “I’m going to purchase an urban mixeduse project with residential over retail. That way, if no one wants to live there, I can still rely upon the retail to provide a return on investment.” TCRE Agent: “Uhh, sure.”
The construction of new buildings on under-utilized, vacant land in an existing, mature urban neighborhood. Developer: “I need an urban infill fix.” TCRE Agent: “I’ve got land, value-add, or if you’re feeling crazy tonight, both.”
8 Redevelopment: The renovation of an existing, often historical structure. As opposed to new development, redevelopment retains the character of the existing building. Sometimes includes/requires tax incentives or municipality funds to complete the project. Buyer: “Our goal is to complete the Redevelopment Project in 120 days from close of escrow.” NIMBYs: “We like living near blighted warehouses better.”
5 Pile of shit Term used to describe a building that is functionally and structurally obsolete, requiring demolition. The term’s etymological roots stem from early Sacramentan folklore of a Supreme Deity walking across the urban core and needing to defecate at the exact spot of the Subject Parcel thereby creating the Subject Property. Buyer: “This Property is a complete pile of shit.” TCRE Agent: “Wouldn’t be value-add if it wasn’t.”
9 Gentrification The rebuilding of a declining urban district, usually driven by the influx of middle to upper-income individuals and new development. Often displaces long-time residents and/or commercial tenants as property values increase. Can be correlative with the replacement of locally owned businesses by corporate chains. Property Owner: “What’s the issue? I really don’t consider replacing The Beat record shop with BevMo! to be gentrification.” TCRE Agent: “Ummm...”
6 Value-add Adjective referring to a property with the potential to be more valuable once it is replaced or renovated. Buyer: “Is this pile of shit really a value-add property?” TCRE Agent: “I think it has the potential to be a wonderful affordable housing project. And if all else fails, it can be a coffee shop or brewhouse. And if that doesn’t work, there’s always CrossFit.”
Random data from our office! How many JUMP Bikes do you see in use on a daily basis?
0-3
The funniest slang for cannabis is:
Who makes the best quesadilla?
9+
Centro
Zocalo
Jazz Cabbage Devil’s Lettuce
4-8
Azul
Giggle Bush Beezelbub’s Broccoli
1
4
Perf ec t f or t he ou t -of-touch!
MIDTOWN ETIQUETTE
As any city grows, like Midtown, new residents may not be fully educated on the local unspoken rules. Is civility still around? Do manners exist? Can’t we all just get along? We say yes. To find out how, read on.
COREY LAU - CREATIVE DIRECTOR
1 Not-so-frequently-asked Questions Is it okay to talk to randos in the office elevator? If there are fewer than seven people, no. However, if the group includes seven or more, it has achieved Elevator Humor Quorum and someone is required to make a remark on the lack of space /speed to relieve the tension. If another member of the group makes the remark first, you are obligated to chuckle quietly to yourself.
If I’m walking on the sidewalk and a biker, ALSO on the sidewalk, is riding my way, am I obligated to move aide? Absolutely not. Cycling more than a half block is forbidden on sidewalks. Pedestrians are advised to band together and form a human wall.
Is it okay to smoke weed at a house party? Midtowners generally consider cannabis to be a necessary public good like electricity or roads. That said, ask the host before using any combustion-based THC ingestion devices. And consumption is always forbidden if there are minors present, or if anyone in the room is 25 years older than someone else.
How do I talk about how cool Midtown is without sounding like a jerk? Don’t mention it at all unless someone asks how you’ve been enjoying the city or you are in a lively conversation about urban planning. Never, force people to talk about how cool your city is (“That’s cool, almost like Midtown... what? Oh, yeah, I live in Midtown. It’s amazing”), a cringe-inducing behavior whose legality is one of the few universally recognized downsides of the First Amendment.
Is it cool to use my neighbor’s unprotected Wi-Fi? Yes. Free wi-fi is a karmic gift bestowed by the Rental Gods to make up for all the times you’ve had your parking spot taken, overheard your neighbor’s sexual encounters, and had the misfortune of sampling the vegetable-oil/cigarette/ litterbox-scented apartment hallway. Just don’t hog all their bandwidth.
If my upstairs neighbor is being too loud, can I tap the ceiling with a broom? Yes, but gently. The amount of upward force with which you thrust the broom handle should not exceed the amount of force you use with a pool cue when playing billiards. Exceptions to this rule are allowed, and even encouraged, if the noise is between 1:00 - 5:00 AM.
2 Okay vs. Not Okay
YOU:
You’re walking down the sidewalk when a cat walks up to you invitingly.
Pet the cat (at least say hi).
Scare the cat by stomping and yelling.
A non-local friend asks you to show them a good coffee shop.
Take them to Temple Coffee on K and 22nd.
Take them to Starbucks or McDonald’s.
While working at a coworking place, someone taps you on the shoulder and says you’re in “their usual spot.”
Apologize and politely assert that you will remain there unless they pay for this reserved spot.
Firmly assert that you will remain there, ending with a sweaty “Good day to you, SIR!”
Dancing at Golden Bear, you bump someone and spill their drink.
Buy them a new drink, maybe even garlic fries.
Say sorry and hit on their cuter friend.
3 Basic Bike Rules Don’t be one of those cyclists. You know the kind. If there’s a bike lane, use it. No riding on the sidewalk unless arriving at your destination. Treat stop signs as yield signs. This usually means you need to stop. Use hand signals to indicate turning. When parking at a rack, leave adequate space for other bikes to park. When yelling at someone who almost ran you over, be sure you can make a quick getaway.
4 How Long is Too Long to _______? ACTION:
TIME LIMIT:
Choose what sandwich I want at Bon Air Market.
Once the person behind you sighs heavily / clears throat.
Kiss my lover in public.
Once someone is able to pickpocket you during the embrace.
Pet a random person’s dog I just saw on the street.
Once the owner stops replying to your dogrelated questions.
Finish my beer.
Once your friend has taken the first sip of the next beer.
Listen to my Baby Boomer neighbor’s diatribe against millennials.
15 seconds.
This car must yield until there is an opening for them.
STOP
Through traffic does not stop.
Through traffic yields only to pedestrians and cars already in the roundabout.
U-turns are allowed here.
STOP
This car must yield until there is an opening for them.
5 How the “Roundabouts” Here Really Work (Hint: they’re not actual roundabouts) If you’ve driven through Midtown, you’ve likely encountered the traffic calming roundabouts. These intersections are actually NOT roundabouts, but “traffic calming circles,” as the City calls them. While roundabouts are aimed at reducing congestion, traffic circles are installed to reduce speeding and disincentivize long distance travel via those routes. This was part of the City’s massive traffic redirection
campaign in the 90s. Okay, so they aren’t actual roundabouts - Are the rules the same? No. The traffic circles are all built on 4-way intersections that have stops signs for two of the directions. Treat them like any other intersection with through traffic that does not stop. At no point do vehicles need to yield to cars stopped at the stop signs.
8 Things Midtowners Never Say “What is the ‘Mars’ Building?” “Oh my God. Was that two dudes kissing?” “Mmm! Fast food!” “Midtown is cute and all, but LA is so much nicer.” “Have these homeless people tried not being poor?”
6 A Note on Dog Feces ACCEPTABLE RESPONSES TO YOUR DOG POOPING OUTSIDE: “Ope! Hope no one saw!” “Good boyyyyyy.” “Eh, it’ll decompose.” “Well, I dislike touching feces, but I am a responsible adult and a good citizen, so I will pick it up and put it in the trash.”
7 Alley Etiquette DO
“I’m craving Starbucks”
DON’T
“Oh yeah, the Victorians? So ugly and old.”
Let other cars out before you drive in.
Zoom into the alley and cause a clog.
Lock your dumpster / stow away trash cans.
Leave your waste out for rummagers to make a mess with.
“I’m really liking the new F-150s with lift kits.”
Pull far over when parking temporarily in the alley.
Hog the roadspace, thus closing the alley to traffic.
“I wish they’d leaf-blow every day.”
“I just think it’s a Witch Hunt™” “Bikes are nice, but I think I’ll drive.”
“Ugh, those JUMP bikes are awful.”
TURTON COMMERCIAL - 916.573.3300 - TURTONCOM.COM
F O R SA L E
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MultiFamily RESIDENTIAL | SEVERAL PROPERTIES | IN THE GRID
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A s Sac rament o g et s c ool er, rents get hotter.
HO W H I G H A R E M ULTIFAM ILY RESIDENTIA L RE NTS
IN YOUR AREA? ZACHARY HOOKER - DIRECTOR
How hot is the rental market for multifamily residential units in Sac? To put it succinctly: Spicy. But some areas are spicier than others. See how your building compares to nearby averages on our multifamily rental rate heat map. Contact Zach for more specific numbers and info regarding multifamily acquisition / disposition.
$1.00 / SF
$3.00 / SF
Rental rates of each zone are averaged and subject to change by the time of publishing.
New Era Park Alkali Flat
Mansion Flats Boulevard Park
Downtown
Midtown
Southside Park
Newton Booth Richmond Grove
Poverty Ridge
FOLSOM BLVD DEVELOPMENT SITES FOR SALE T U R T O N C O M M E R C I A L - 9 1 6.5 7 3.3 3 0 0 - T U R T O N C O M .C O M
6011 FOLSOM BLVD
FOLSOM BLVD 65TH
6409 FOLSOM BLVD
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Ha v e a g enet ic adv ant a ge gra nti ng you the a b i li ty to op era te o n l e s s s l e ep?
SO, Y O U WA N N A
BE A BROKER, HM? KEN TURTON - PRESIDENT
Almost every week, I find myself sitting in a coffee shop with someone asking about becoming a commercial real estate agent. Usually this occurs around 1:30 PM and I’m drinking a double espresso since each day of my life starts at 4:00 AM. This alone should provide some insight to the aspiring applicant. Commercial real estate can pay very well, but it is mentally and emotionally challenging. At 9:00 AM you can receive a call to work on a great new assignment and at 1:00 PM the same day receive word a deal you have been working on for eight years collapsed. Why would someone want this lifestyle? For me, its Freedom. To be truly free, you must be financially independent and carry no debt. “Financially independent” means different things to different people. Regardless, Commercial Real Estate provides the vehicle to achieve whatever financial goals you have. So, why doesn’t everybody become a commercial real estate agent? 1) Risk. Commercial Real Estate is a commission only business. The first two years requires an individual to live on a very modest income. In addition, there are no guarantees of a lucrative future. 2) Independent Contractor. You pay your own taxes and benefits. You are effectively running our own business and your busi-
ness is you. 3) Tough First Year. In general, the gestation period for a real estate transaction is six months. The first day you commence your career, you are at minimum six months away from a pay check. 4) Discipline. Make no mistake, you must commit to commercial real estate as a career and therefore, in my opinion, you must find a way to work a minimum of 60+ hours per week the first five years of your career. 5) Rejection. The best in our industry are successful 33% of the time. They get rejected 67% of the time. So, you can deal with the forementioned. What personal qualities make a great agent? 1) Resilience. A relentless, passionate determination to succeed. Both for you and your client. 2) Intelligence. The more you have the better off you and your clients are. And the more likely you will be successful. 3) Likeablility. You can check off every box above, but if you are not likeable you will not be very successful in commercial real estate. At the end of the day, we are all people working together with other people and people like doing business with people they like. 4) Penchant for applying for jobs. Because it’s essentially what you’ll be doing for the rest of your working life as you chase new clients. 5) Insomnia. Typically, not a great personal characteristic but comes in handy when a Proposal, Valuation or Property Report is due the next day.
6) Access to psychological counselor. Highly recommended for the lifestyle you’ll be taking on. The commercial real estate career, while a daunting undertaking, can be tremendously rewarding - not just financially, but also as you influence the culture and direction of your city. I’m happy to chat over coffee if you have any questions.
FLOWCHART:
SHOULD YOU GET INTO COMMERCIAL REAL ESTATE? No
Like hard work? Yes Are you smart?
No
Yes No
Can you handle repeated rejection? Yes You okay with faces on business cards?
Yes
No Try Commercial Real Estate Try Residential Real Estate Try making a magazine when you’re not a publishing house Try Title and Escrow Try Lending Left: How most new commercial real estate brokers feel after their first month.
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ZOOM PATRICK STELMACH - DIRECTOR
Suddenly appearing overnight, the new JUMP Bikes have immediately established themselves as the quickest - and most fun - way around town. If you’ve spent time on the streets of Sacramento, you’ve noticed the sudden proliferation of red cruiser bikes with front baskets and solar panels. This isn’t a coincidence of hundreds of consumers purchasing the same bike. They are JUMP bikes: Sacramento’s newest effort to transform how people
commute and have fun on the grid. The bikes have an electric assist motor that provide a boost every time you pedal. They can achieve speeds up to 20 miles per hour (although several of our TCRE bike aficionados claim north of 25 MPH to be achievable).
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So Simple!
Us ing a JUMP Bike :
One of the key characteristics of the JUMP Bikes is their ease of use. It’s easier than ordering an Uber!
1 Get the app. Download the JUMP app and set up an account. The app gives you a PIN code to unlock bikes under your account.
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3 Enter your PIN. Using the terminal built into the bike, type in your phone number and PIN code. If you reserved the bike in your app, you will not need to enter your phone number.
4 Ride! The bike is now unlocked and the clock starts ticking on your usage. $1 for 15 minutes then 7 cents for each additional minute. Monthly membership is $30 / month and allows for 1 hour of riding per day. 7 cents / min after that.
The Uber app also works with JUMP!
2 Find a bike. Find an available bike using the app and then walk to it. There are options to reserve bikes as you are en route to them.
5 Be done with it. Once you arrive at your destination, re-lock the bike to a rack and forget about it. Maybe you and that bike will be reunited some day!
With JUMP Bikes, you can go 5 miles in 10-15 minutes with less effort, less sweat, and for a fraction of the cost of parking and maintenance. You can “jump” from Midtown to Tahoe Park to West Sac to Davis, and everywhere in between. JUMP is a startup recently acquired by Uber. Sacramento was selected as one of eight launch cities along with San Francisco, Washington D.C., Santa Cruz, Chicago, Austin, Denver, and New York City. Sacramento is the perfect test market: flat, dry, and located near the “Bike Capital of the USA” – Davis. Since bike share was introduced in Sacramento, usage has been much higher than anyone anticipated. There are currently about 650 bikes total in the system, and about 300 bikes available at any given time. The rest are currently in use or being swapped out and charged by the JUMP team.
This article was made possible by Brooke: JUMP’s biggest fan!
S O M E WO R D S F RO M O U R F R I E N D S O N T H E M AT T E R
“For me, the JUMP Bikes provided an opportunity to use an alternate mode of transportation without making a large financial commitment.” - Sureena Johl Events Manager, Downtown Sacramento Partnership
“As an Uber Driver, I fear that these bikes will impact my income. They are cheaper and more fun than Uber if you live in the downtown area.” - Anonymous Uber Driver
“JUMP Bikes make the city more accessible for a good price. the Midtown experience feel more integrated and are also really fun to ride!” - Kyle Decoque McKinley Village Resident hoping JUMP expands to his neighborhood
You can find bikes at any of the “hubs” – the gray bike share racks, but the bikes are actually “dockless” and can be locked to any public bike rack in town (or sign post if you dare to risk the unlikely fine). The system was designed for 900 bikes, and when the full system rolls out later this year, Sacramento’s JUMP market will be the biggest in North America. That’s pretty cool! The more bikes there are, the more reliable a transport method it is. The goal is to give people more transportation choices and to bridge the gap between different transportation methods. Sacramento is the perfect place for bike share to thrive. Currently, bikes as a mode of transportation in Sacramento account for only two percent of all trips taken, and it’s hovered in that same range for the better part of the last decade while other cities are seeing an increase in bike adoption. The City of Sacramento sees an opportunity and is working to change that. With protected bike lanes and now our growing relationship with JUMP bikes, we may be witnessing a shift towards a car-free culture in the urban core. Bike share is a compelling transportation option. It is cheaper than parking for your car, cheaper than Uber or Lyft, and maybe even cheaper than owning a bike. If you drive your car from your office in Midtown to a meeting in Downtown, parking alone will cost you at least $2-$3 at a meter, and the lowest daily rate you can probably find is $10. Its twice that amount to park downtown for a Kings game or special event. Even if you get a rideshare, you
“They encourage green commuting. And it’s nice to be able to pull up straight to your destination and not have to worry about your bike.” - Angela Sardo UC Davis Medical Student
“I think that JUMP Bikes help build the community because you see others riding them and you want to wave and socialize with them more.” - Sam Dunham Midtown-lover, Archaeologist
Left: People on JUMP Bikes can easily cruise at higher speeds with minimal effort thanks to the electric assist motor built in. Top: The bikes can be locked to any location a normal bike can, but JUMP wants them locked to bike racks and the official JUMP Bike docks.
“People love to complain about traffic yet when an alternative is introduced, they complain about that too. It is baffling. To me, JUMP Bikes are a fun and easy way to get around town without using a car. Wish there were more of them.” - Rob McAllister Play-by-play Announcer for Sacramento Republic FC
still have wait for the car to pick you and you may still get stuck in traffic. JUMP Bike is also attempting to make it more equitable: low-income qualified individuals can get a member for $5 for the first year, and $5 per month after that. Bike share is an efficient form of transportation; but moreover, it is fun and easy. The result is that bike-share will inspire people to ride bikes who are not necessarily bike riders. People who haven’t ridden bikes in years or decades are suddenly compelled to be propelled by these electrified cruisers. Whether looking to offset car usage, or just looking for something fun to do, JUMP Bikes are a great choice. So Jump bikes sound amazing… what is the downside? Many complaints surrounding JUMP Bikes are due to their aesthetic. That bright cherry red helps drivers spot bikers, but have
been described as making “my neighborhood look like a Target parking lot” by NIMBYs. While bikes are supposed to be locked to bike racks, Sacramento has not provided (yet) an efficient network of bike racks throughout the city leading to many to lock bikes on street poles and parking meters. Some people see clutter instead of a future with less car dependence, less pollution, less traffic and a thriving urban core. However, the good news is that JUMP launched the bike share system with the Sacramento Area Council of Governments (SACOG) and is looking for a long-term bike share system that ultimately leads to a thriving urban core to be enjoyed by residents, visitors and businesses alike. While there may be some speed bumps along the way, we at Turton feel that JUMP Bikes are a great addition to the grid and are here to stay.
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Keep Midt ow n art sy ; keep Mi dtown hi s tori ca l; keep b ui ldi n g mo re h o u s in g.
AS M I D TO W N G ENTRIFIES, W E M UST SEE K COE X IS TE NCE BE TWE E N
JANKY & SWANKY PATRICK STELMACH - DIRECTOR
W When is Midtown not “Midtown” anymore? Change is inevitable. Gentrification is, too. It’s a normal part of a neighborhood’s lifecycle. But how much can a charming place like Midtown change and still be the same artsy, inviting neighborhood? As Midtown continues to gentrify, there is case to be made that, in some instances, we need to preserve the old buildings that look “janky” - or else we run the risk of changing Midtown beyond recognition and becoming homogenous and uninspiring.
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Top: Big new apartment complexes like this one shown at 1801 L Street are certainly luxurious and high-density (yay!), but do they fit in with the local character? Bottom: What was formerly a dusty, forgotten warehouse façade is now the lively backdrop for a bocce ball court at Ice Blocks.
What is “gentrification,” exactly?
Gentrification is a general term for the arrival of wealthier people in an existing urban district, a related increase in rents and property values, and changes in the district’s character and culture. The term is often used negatively, suggesting the displacement of poor communities by rich outsiders. But the effects of gentrification are complex and contradictory, and its real impact varies.
The corner of Capitol Avenue and 28th Street is a cautionary tale of losing the essence of what makes Midtown charming. Formerly the historic and popular Café Bernardo/Monkey Bar building, the site has been demolished and is now a tarp-covered dirt patch awaiting development. There is a nostalgic gravity standing on the corner, as well as a sense that the character of the neighborhood has changed forever. Is there anything even left of “Midtown” around there? There’s nothing inviting people to linger and enjoy the neighborhood.
The shiny, sterile walls of Sutter Medical Center and the concrete brick walls of the RT bus facility are harsh for the passerby. The Biba restaurant building does admittedly have the charming historic aesthetic, but the storefront’s not activated, the curtains are always drawn, and there’s no outside seating. And when the new building is opened, how much will land values increase in the area? It will surely impact the residential rents of some nearby properties – will people need to move away just because someone wanted to build a tower?
Historic buildings can’t always be preserved in amber, but what could be done differently to maintain the historic features we love as part of new projects we need? And how can we do it without pricing out the quirky, creative people who made Midtown interesting in the first place? The responsibility is on us, the modern urban dweller, to acknowledge and mitigate the negative impacts.
D E V E LO P ME N T O P PO RT U NI T IES Calvine Auberry – 3.67 AC 20th & R Street – 0.25 AC 65th Street – 1.45 AC Power Inn – 12.76 AC Royal Oaks – 4.57 AC Meadowview – 14.89 AC Florin Station – 2.00 AC Butterfield – 3.21 AC Swanston – 2.00 AC 4330 Watt Avenue – 1.50 AC 21st & T Street – 0.29 AC
Folsom - Leidesdorff Village – 3.00 AC 58th and Broadway – 0.27 AC Fair Oaks Village – 1.01 AC 3131/3141 W Street – 0.33 AC Rocky Ridge Duplexes – 1.20 AC 6409 Folsom Blvd – 0.52 AC 6006-6011 Folsom Blvd – 1.57 AC 2227 10th Street – 0.54 AC 1031-41 Olive Drive, Davis – 0.43 AC 18691 N Hwy 99, Lodi – 1.52 AC 2400 5th Street – 0.54 AC
LAND DEVELOPMENT OPPORTUNITIES THROUGHOUT THE SACRAMENTO REGION 916.573.3300
TURTON COMMERCIAL REAL ESTATE
TURTONCOM.COM
SMALL OFFICE SUITES FOR LEASE
HARD-TO-FIND IN THE HEART OF THE GRID
Hidden GemS
The Cannery - MARRS - 701 E - 1117 F - 1600 H - 2131 Capitol 2115 J - 2523 J - 2530 J - 2418 K - 2300 N - 1412 16th - 1614 19th* 1001 2nd - 200 K - 1207 Front - 5025 J - 3319 J - 2409 L - 1220 H
*Pupper not included with lease
TURTON
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How does gentrification affect an area?
THE GOOD Many aspects of the gentrification process are desirable. It’s hard to argue against reduced crime, new investment local infrastructure, and increased economic activity in the neighborhood. Median income increases. Blighted buildings get a new life. Rehabilitation projects, housing developments, new shops, and restaurants abound. Public improvements like bike racks and street-scaping are supported. The community’s economic activity
The Gentrification Starter Kit!™
supports new ventures owned and operated by Sacramentans. In Midtown, the MARRS building is an example of positive gentrification. Before Heller Pacific and Fulcrum Property molded it into the social haven it is today, MARRS was a dusty, unactivated, State-owned industrial warehouse (and not the cool-looking kind). Now, LowBrau and the entire street in front of MARRS is arguably the epicenter of Midtown.
THE BAD Unfortunately, the benefits of these changes are often enjoyed disproportionately by the new arrivals, while the established residents find themselves economically and socially marginalized. Gentrification has been the cause of painful conflict in many American cities, including Sacramento, often along racial and economic fault lines. The upward spiral of desirability and increasing rents and property values often erodes the very qualities that began attracting new people in the first place. The fear is that as rents and home prices continue to rise, the earlier residents - the creatives, the basement artists, the backyard musicians, the lower-income people, the diverse communities of color; the people that made Midtown interesting and created the value - are being priced out. Many anecdotal accounts suggest that this dynamic has occurred in San Francisco, which lacks the vibrancy the local culture it used to radiate.
Meanwhile, the success of Sacramento’s local businesses is attracting national retail chains. Large corporate stores seize upon the gentrifying neighborhoods; able to pay higher rents they undercut the local existing businesses, who can’t compete in sales and stay in business. If Midtown was to rapidly homogenize, it would dampen creativity and stagnate our economy. Midtown is at risk of becoming a victim of its own success.
Top (2): What the MARRS Building looks like today versus what it looked like before it was renovated. Gentrification made this strip more inviting.
owner-user opportunities available in sacramento 2201 J - 2501 Capitol - 6409 folsom - 2830 I T U R T O N C O M M E R C I A L - 916 . 573 .33 0 0 - T U R T O N C O M .C O M
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How can we manage gentrification?
We cannot stop gentrification. But we can manage it.
We can curate it in a conscientious way that adds value and respects the existing community. Turton Commercial helps developers and investors acquire vacant or underutilized buildings and, during the renovation, we lease up the buildings with interesting, unique, local businesses that are authentically Midtown. And, if Sacramento’s housing
supply meets demand, we won’t see the outrageous rent increases we’ve witnessed lately. In the interest of reducing the rent hikes which force locals to move away, we advocate strongly for the construction of new high-density residential developments. We work with developers to identify viable project sites in the urban core. Density is a good thing!
Ultimately, to handle gentrification in a way that doesn’t hurt a community, a series of policy changes to designed to encourage conscientious development are required: QUIZ CONTINUED FROM PAGE 11 PAT R IC K ’ S P O L IC Y P R O P O S A L S ( P P P )
Start at zero on page 11. Add or subtract points based on whether or not you can recognize the location of the image.
A Build more housing, across income levels in the urban core. If supply can meet demand, rents will be more nominal and locals won’t be displaced due to affordability.
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B Build higher density, in all areas of Downtown and Midtown. Although 10-15 story buildings next to 1-2 story homes may stick out, the benefits of the development outweigh the shadows!
C Invest in public transit and development near transit stops to reduce strain on the road network, ensuring that the urban core is pedestrian-friendly as density increases.
D Lower impact fees on development projects and increase coordination within government agencies to expedite the approval process.
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Top: The development of the 11-story residential tower at 19th and J is one of few recent efforts at increasing the supply of affordable housing units in Midtown.
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Stop rent control measures which will dis-incentivize new housing development, thus worsening the displacement problem.
F Implement the Mills Act. Cities in California can incentivize homeowners to rehabilitate their historic homes with property tax breaks. This will help preserve the local historic homes which contribute to an area’s cultural value.
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G Expand the Historic Tax Credits program. Owners of historic commercial properties who renovate the property can currently receive a tax credit of 10-20% on the rehabilitation costs.
Change - in fortunes, in populations, in the physical fabric of communities - is an abiding feature of urban life. Residents, developers, business owners, and city government can pre-emptively work to accommodate these changes and create a win-win situation.
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QUIZ CONTINUED ON PAGE 31
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Why is it so hard t o keep b ui ld-out cos ts low? Beca us e thi s is t h e part o f T h e S ims t h at yo u c h e at ed yo u r w ay aro u n d w h e n yo u w ere yo un g .
C R E ATI V E WAY S TO SIDESTEP
HIGH T.I. COSTS SCOTT KINGSTON - VICE PRESIDENT
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“WHAT THE &$%#? THE GC WANTS WHAT FOR THIS TENANT IMPROVEMENT?” – everyone at TCRE for the last six months when receiving an estimate back from a general contractor for a tenant improvement bid.
AN IN-OFFICE SURVEY: Have you witnessed a lease deal fall through due to high TI costs?
No
Yes
Top left: A rendering of a break area using high-end finishes. Top right: The same space filled with cheaper analogues of the high-end finishes, saving $14,250 in this space alone. Renderings by RMW Architecture & Interiors.
Unfortunately, this remark - and many other similar comments not suitable for print - have become increasingly common. This is because the cost of tenant improvements has increased by at least 50% over the last year. As a direct result of these cost increases, structuring lease agreements with any sort of tenant improvement component has become very complicated. Just about every single lease I’ve
completed in the last 15 years has required a reasonable level of tenant improvement work – so this is a problem that affects nearly every office, industrial, and retail lease currently being negotiated. Of course structuring a longer term with a higher rental rate will solve the problem – but are there other creative ideas we can use to avoid signing a longer lease with higher rent?
S P O T T H E D I F F E R E N C E B E T W E E N T H E T W O T. I . PAC K AG E S A B OV E ! 1 Back-painted Glass vs. Laminate Backsplash
7 Quartz vs. Laminate Flooring
2 Wood Plank vs. Wood-look Wall Treatment
8 Concrete Floor vs. Luxury Vinyl Tile
3 Wood Door vs. Painted Door
9 Brick Accent Wall vs. Graphic
4 Fancy Pendant Lights vs. Budget Version
10 Expensive Industrial Light Fixture vs. Cheaper Version
5 Luxury Cabinet Hardware vs. Standard Quality
11 Square Recessed Downlight vs. Round Recessed Downlight
6 Complex Cabinetry vs. Simplified Cabinetry
12 Gypsum Board Soffit Ceiling vs. Suspended T-bar Cloud
Creative techniques to keep improvement costs low!
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Use cooperative relationships to open up allowances
TCRE is a strong proponent of “cooperative representation.” Tenants and landlords get better terms when they work together cooperatively rather than as adversaries. More often than not, getting the best terms for a client is a function of knowing the best fit for both parties. A significant
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component of this cooperative process is bringing all parties together to work hand-in-hand on the space design which results in a space that both tenant and landlord are happy with – and one that hopefully keeps the cost down which results in a better deal for both parties.
Consider multi-generational tenant improvements
Designing a space with improvements and finishes that are re-usable from one tenant to the next is wise. Instead of building a completely customized space with improvements that will likely be demolished after a tenant vacates, the team should agree on a layout that both functions for the tenant and their lease term and for future tenants down the road. This will help the landlord justify investing additional tenant improvement dollars up front.
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Get it right the first time with 3D renderings
Three-dimensional space design has been a game-changer in the commercial architecture world – and it has made the process of designing and visualizing a particular space extraordinarily powerful. Historically space design has been very rudimentary, with two-dimensional floor plans supplemented with physical samples of possible finishes, and two-dimensional elevations of the areas that need special attention. With 3D, we are able to walk a tenant through their space in real time, providing a clear sense of space, volume, finishes, and how they all come together to create the perfect space. This technology allows tenants and landlords to optimize space design, and has completely revolutionized how space planning and design will be done going forward.
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Start at zero on page 11. Add or subtract points based on whether or not you can recognize the location of the image.
Find the cheaper version
It’s a bummer for a tenant to have to find ways to live without a particular feature, element, or finish in their space. Our creative solution has been partnering our clients with experienced architects and interior designers that can deliver a nearly identical “look and feel” of their ideal space at a much lower cost.
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QUIZ CONTINUED FROM PAGE 29
Use furniture creatively to reduce construction costs
Another effective strategy is to utilize furniture to reduce the hard construction costs. This includes decorative wood panels to separate reception areas from open office areas, utilizing modern workstations to replace hardwall offices, and implementing storage solutions to reduce builtin cabinetry and millwork (which is obscenely expensive). We have seen tenants save more than
$10.00 per square foot by moving to a more furniture-based design - even when accounting for the cost of the furniture. Additionally, using furniture to plan a more open and collaborative space enables a tenant can reduce their footprint by more than 25%. A reduction of 1,000 SF of rented space saves roughly $150,000 or more on a five-year lease.
Bottom (large): For the office of NORR Architects & Engineers, they chose to go with the absolute best finishes to show off their specialty to their clients. Bottom (small): While more humble (and unfurnished), the open office space at 819 19th Street portays a similar aesthetic and attitude for a fraction of the price.
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I s it a qu adrant 1 kin da ni ght or a q ua dra nt 3 ki nda ni ght?
B EE R S P O T
BRAND PLOT BROOKE BUTLER (MSc Marketing) - VP OF OPERATIONS & MARKETING
A totally subjective, off-the-cuff dissertation on the local beer scene from someone not in the industry! Not all beer halls are the equal. For your convenience, we’ve dropped some of Sacramento’s beer serving establishments on a scatter plot based on price and their brand’s vibe. Sometimes you want light American beer at a divey sports bar. Sometimes you want to groove to techno while
you sip your IPA. And sometimes you want to pretend to notice the subtleties of your extra-cloudy wheat lager in an austere tap room. Regardless of your taste, you can be sure Sacramento has it on tap. If you really can’t decide where to go tonight, throw a dart at this page and see where it lands!
HIGHER PRICE Canon Ella Urban Roots Fieldwork
Firestone
Device Federalist
Karma Brew
Golden Road
De Vere’s
Pete’s
Alaro Der Biergarten
Burgers & Brew
Kupros
Highwater Bike Dog
Bon Lair
Sac Yard
Big Stump
Ruhstaller
Track 7
Sactown Union
HIP / GENTRO-CHIC
NOT SO TRENDY
University of Beer
Capitol Beer & Tap Room
LowBrau
More well-kept, waxy mustaches
New Helvetia
More scruffy, who-gives-a-damn mustaches
Alley Katz
Brew Bike Bar
Zebra Club Old Tavern
#4
#5
Paulaner Munich Lager
#3
Stir Cider
We take a lot of (late) afternoon breaks at Der Biergarten on 24th and K. Here are our most-frequently-ordered brews.
#2
Knee Deep Triple IPA
Der Biergarten!
#1
Schnöfferhofer Starburst
Some of our favorite beers on tap at
Weihenstaphaner Vitus
LOWER PRICE
ALL ASPECTS OF OUR BUSINESS
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What we’re keen on preserving (and key to integrating your business into the area)
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What we specialize in (and necessary to make any real estate decisions)
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What we know the locations of
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What we’re known for making
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How we want to keep it
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How we help you keep your properties running smoothly
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Who we meet with weekly
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What to do if you’re moving your business to the grid
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They ask us to fill their vacancies
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What we’re skilled at finding
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How we can help with your big ideas
TURTON
Turton Commercial - 916.573.3300 - Turtoncom.com
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IN THE MIDDLE OF
EVERYTHING FOR LEASE R A R E L A N D M A R K S T RU C T U R E 1 B LO C K F RO M GO L DE N 1 CE NT ER
70,000 SF O F F I C E / R E TA I L 1 0 0 PA R K I N G S TA L L S
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A C H AT W ITH SACRAM ENTO’ S
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NE W A S S IS TA NT CITY MA NA GE R,
MIKE JASSO I N T E RV I E W E D B Y: J O N L A N G - V I C E P R E S I D E N T
M Michael Jasso, recently hired as the assistant city manager, brings nearly two decades of public sector experience to the post. He will be overseeing the city’s Office of Innovation and Economic Development, as well as the Community Development Department.
E XP E R IE NC E
Jasso is forward-thinking, progressive, articulate, and brings a pragmatic approach to economic development. Our team is excited to work alongside him and know he’ll be a great asset to the City of Sacramento.
Chief Cook County Bureau of Economic Dev. Managing Deputy Commissioner Chicago Dept. of Housing & Economic Dev. Chief Development Officer Chicago Housing Authority
JL – Well, welcome to Sacramento. Just curious, what was your perception of Sacramento before taking the job as Assistant City Manager?
Top: Mike Jasso in Cesar Chavez park a few hours before Concert in the Park.
MJ – I didn’t know very much about Sacramento at all, to be honest. I obviously knew it was the capital of California and that gave the city some gravitas. And I generally knew where it was, physically, in the central valley, located between the Bay Area and Tahoe. However, the good thing about that is I didn’t have a negative perception of Sacramento, so the lack of perception spoke to a sense of stability. I can say, that I am very happy to be here and have only found the City to be a welcoming place since day one. Having not known much about Sacramento, why did you take the job? Sacramento is a certain size. The population is about 500,000 people in the central city, 2.5 million in the metropolitan area. And in some ways, that’s the “sweet spot” from an economic development perspective because the city is large enough to have gravity but not so large as to have the inertia that a huge metropolitan city can have if it’s not moving in the right direction. So, theoretically, a city like Sacramento, if the stars align, can move swiftly to make economic development changes.
So, has that perception changed now that you’ve spent some time in the city? I think that Sacramento is a fascinating mid-sized city at a point of inflection created both deliberately and by circumstance. Deliberate in terms of political initiatives, business growth, community development, and leadership thinking about what Sacramento can be. And poised by shear circumstances outside of Sacramento’s control. For example, what’s happening in the Bay Area and at the state level. As I’ve gotten to know the city, it’s appealing that Sacramento has an intention to be regional and understands its place in the broader context of what’s going on in the larger metropolitan area and state. What is the biggest parallel, if any, do you see between Sacramento and the greater Chicago area? Both cities are cities of rivers. To some degree, historically, rivers have not been considered big assets in which to deploy resources. But, now that’s changing in both Chicago and Sacramento. Until about 20 years ago, the Chicago River was a working river and it was very much the second water front to Lake Michigan. However, through very deliberate efforts by the city, you can now walk uninterrupted along the improved river front
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Left: A recent Chicago transplant, Jasso says he’s found Sacramentans to be warm and easy to get along with.
for miles. Sacramento also has huge potential to activate the waterfront in a meaningful way. Great waterfronts and great rivers define great cities all over the world and Sacramento needs be thinking this way. How does Chicago approach development? What’s an example of a unique development in the city?
EDUCATION
Chicago is very good at thinking big and outside of the box - big projects that really transform the city. For example, most recently, the Department of Planning and Development, the Chicago Housing Authority, and public libraries partnered on three key redevelopments in what we called “opportunity areas.” The redevelopments are multi-use projects that are anchored by public libraries on the ground floor with housing above. This is a great example of deploying public housing dollars, while helping fund a public amenity in an area that needs it. Thinking beyond one silo of housing or one silo of commercial development are some of the patterns that I learned in Chicago and hope to see here. B.A. - Architecture Princeton University Master of Business Administration (MBA) University of Texas, Austin
How did working for the Chicago Housing Authority and Department of Planning and Development shape your outlook on housing growth and development in Sacramento?
do it in a way that supports inclusive economic development growth. We cannot afford to have a strong vibrant city core, which we absolutely want, with languishing neighborhoods. I want to focus on work-force development because if you get that strategy right, other positive things will follow. Two, there’s clearly no greater challenge in Sacramento than addressing the housing affordability crisis. We need to do as much as we can at the local level to increase the supply of housing, specifically affordable housing. That means lowering regulatory barriers, deploying public assets more efficiently, and figuring out ways to aggregate new and old tools that promote housing. The city has a responsibility to all our communities to make sure they are safe and livable communities. Well, let’s talk about rent control then. Thoughts?
Well, first off, it depends on how you define rent control. Rent control attempts to address some real issues that we see in Sacramento. And that’s rapidly The Chicago Housing Authority rising rents and evictions that made me appreciate the power of deploying housing resourcare often perversely driven by es to promote overall revitaleconomics. At the end of the day, ization. Strong communities rising rents are symptomatic of are anchored by commercial other flaws in the housing marbusinesses, retail corridors, ket like high construction costs growing neighborhoods and and lack of financing. efficient transit, but housing We need to understand that rent is the most critical part of that. control, in general, is a tempoAffordable housrary fix for a set “There’s clearly no greater challenge in universe of tening is critical because we want Sacramento than addressing the housants, but in fact, communities it may cause ing affordability crisis. We need to do negative effects that are welcoming to everyone as much as we can at the local level to to the long-term and can accomproduction of modate different increase the supply of housing, specifihousing, which income levels. in turn, will cally affordable housing.” The last thing we cause effects wanted to do was exacerbate well beyond the current tenanissues by concentrating povcies. I appreciate the advocates erty in communities that were that are raising this because it’s already impoverished. We tried a real issue, but I also want to be to create affordable housing in cognizant that our role is to stimareas near jobs, schools, and ulate as much product as we can. city centers. Do you think the workforce Switching gears, what are your growth in Sacramento will be top priorities in your new poorganic or is it going to be transition as Sacramento Assistant sient growth from other cities? City Manager? The best way for a city to chart First, to build on the economic an economic growth strategy is development momentum that’s to figure out what they are good already started in the city but at. The traditional view is that
building your sectors that can be sold and offered to outside cities, which brings in wealth and expands local businesses. In that context, I absolutely believe we should support our local businesses and institutions to grow. However, I would say that Sacramento is also living the “mega city” phenomenon given its proximity to the Bay Area. So, I do think that Sacramento has a unique opportunity to leverage what’s going on in the Bay Area because plenty of firms are being pushed out for whatever reason. In our case, I think it’s going to be an equal balance of transient and organic workforce growth. Regardless, I want to make sure that we focus on expanding economic opportunity for all Sacramento residents. This mean increasing good high paying
jobs that are both grown locally as well as attracted to the region as we build a competitive workforce in meaningful industries that are defining the future.
Bottom: Having studied it at Princeton, Jasso proclaims a love of architecture as he stands in the atrium of City Hall.
Lastly, what do you think your strongest skill sets are in helping facilitate your goals for the City? I’m committed to partnerships. I’m a firm believer that the government cannot do it all. We can only grow and succeed in partnership. Government cannot do it all, but that doesn’t mean by ascension that some things shouldn’t get done. I think the government has a role of being a convener, sometimes leading, but also knowing when to step back and try to bring other parties to the table.
PERSON A L PA SSION
As a huge animal lover, Michael is excited that both the operation of the Front Street Animal Shelter and Animal Control fall under the community development umbrella. He knows they do great work and is happy he’ll have the opportunity to directly support them. Michael has a Coonhound Mix named Dexter who is now five-anda-half years old which he adopted at eight weeks old.
RETAI L SPAC E AC ROSS FROM TH IS
980 9 th Street + 1010 8 th Street FOR LEASE
A C R O S S T H E S T R E E T F R O M C E S A R C H A V E Z PA R K
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So m et imes, w e g o a l it tle over the length req ui rements. . .
BITS & PIECES
W E D I D N ’ T H AV E S PA C E F O R E L S E W H E R E
QUIZ CONTINUED FROM PAGE 31 Start at zero on page 11. Add or subtract points based on whether or not you can recognize the location of the image.
T H E C O M PA NY S T O RY
A heavily-abridged timeline of TCRE
2010 – Ken Turton meets with Therapist and asks if he should open his own brokerage firm. She readily endorses the idea and Turton Commercial Real Estate (“TCRE”) opens their doors February 1st, 2010. (a great business decision for Turton and the therapist)
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2011 – TCRE graduates from operating its business out of Turton’s SUV and Peet’s Coffee to leasing 2,000 SF at MARRS. (Couldn’t fit a workstation and printer in the back of a GL450) 2012 – Turton makes the decision to hire College Scholars and build TCRE from the ground up. This also marks the beginning of TCRE’s formal marketing division. ($75M in consideration with 23 year old staff… piece of cake)
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2013 – Turton buys an old dental building at 2409 L Street, blows it up and renovates as TCRE’s future new home.
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You are either a savant with photographic memory or a true Sacramentan out in the city every day! There’s no prize or anything, it’s just pretty cool.
2014 – TCRE moves into 2409 L Street. Multiple coffee shops and breweries move their offices accordingly. Everyone thrives. 2015 – TCRE selected to represent City of Sacramento and Sacramento Regional Transit for disposition of key urban properties. Turton takes firm backpacking for 4 days in Yosemite for team building. Renames it “team experiencing.” Everybody lives. Business is flourishing for both Turton and his therapist.
2017 – TCRE adds Property and Project Management. TCRE’s first year doing $100M in consideration. Turton takes firm to Banff and Glacier National Park. Turton Purchases 2131 Capitol Avenue. 2018 – TCRE starts multi-family division and sells 16 Powerhouse and Lofts at Chestnut for record price per unit. Takes firm to Moab for adrenaline adventure experiences. Everyone still alive.
RANT
Groups that walk side-by-side on the sidewalk
We get it. Midtown is cute and you want to talk to your three friends about it as they experience it with you. But this is no excuse to fan out and create a linear formation like you’re sitting at a bar. Imagine enjoying a stroll though town when a wall
of strangers up ahead begins closing in on you, forcing you to focus on their walking paths and weasel an opening between them to shoulder through. Walk in a way that leaves room for traffic from both sides to move past you.
90-180 Above: Ken Turton repelling down a 160-foot cliff in Canyonlands National Park, Utah on the 2018 TCRE Team Trip.
You’ve definitely seen the city, but probably forgot a lot of these more subtle aspects since you were so overwhelmed by all the coolness.
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Jeez, have you only rolled through Sac buzzed on a Brew Bike? Get out here, more! (1) Concert in the Park (2) Temple Coffee (3) Flamingo house on K (4) Temple Roasting Warehouse near Food Coop (5) Block Butcher Bar at MARRS (6) chicken statue at 2213 N (7) Philz Coffee at Ice Blocks (8) Ice Blocks Apartments stairwell (9) Living wall of Golden 1 Center (10) Posies mural at 819 19th Street
2016 – TCRE publishes first GRID Magazine. TCRE hired to lease Ice Block 1. Big party. Ice Block 1 burns down. Turton takes firm to Grand Tetons to hike the Teton Crest Trail. Turton buys volume discount package with therapist.
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GENTLEMANS NEEDS Need to polish up? These old-school, local services are here to help!
Watch / Doyle Watchmakers / 726 Merchant Street Suits / R. Douglas / 1020 12th Street #112 Shoe Repair / Erin Hayes / 500 Capitol Mall #134 Glasses / Warby Parker / 1710 R Street
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G et sh*t done w hil e h a vi ng fun.
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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 to yield results. 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? Letâ&#x20AC;&#x2122;s grab a coffee at Temple or a beer at LowBrau. Our treat.
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Brooke, John, Patrick, and Melissa - Canyoneering in Utah
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