Downtown “flagship” Starbucks building sold to local investor

Source: Hayes Commercial Group

One of downtown Santa Barbara’s best-located and longest-held commercial properties, 800 State St, was just sold to a local investor. The property received multiple offers and sold quickly after coming to market with an asking price of $8.6 million, or $1,081 per square foot.

The property, built in 1926, had never been marketed for sale. Greg Bartholomew, Kristopher Roth, and Francois DeJohn of Hayes Commercial Group represented all parties in the transaction.

“Adjectives like ‘rare’, ‘trophy’, and ‘irreplaceable’ are often used to describe property in commercial real estate,” Roth said. “In this case they all apply. This type of opportunity comes around maybe once a generation.“

The two-story building offers one of Santa Barbara’s best retail locations, across from the main entrance to Paseo Nuevo mall on the corner of State and De La Guerra streets. Starbucks figured that out back in 1994 and has leased the prominent corner-facing storefront since. Starbucks’ leasing team refers to it as a “flagship location,” which for a chain with 12,500 U.S. locations is really saying something.

Keeping with downtown Santa Barbara’s diverse tenant mix, the remainder of the first floor is leased to local retailers: Just Play Music (with a storefront on State) and Lovebird Boutique (which faces De La Guerra Street). The second floor of the 8,000± square-foot building is office space leased to Ice Energy.

“With a credit tenant like Starbucks, the ownership has the income security to lease the other spaces to local businesses – in this case a record store and a clothing boutique – that contribute to the unique character of State Street.” DeJohn said.

“A property this prominent coming to market for the first time is a big deal,” Bartholomew added. “It’s a good thing for Santa Barbara that it will remain in local hands.”