Santa Barbara commercial real estate broker Jason Jaeger has made it his mission to sell his clients on filling vacancies in the heart of downtown left by businesses that couldn’t make it through the recession.
Even though he worked for six years in Orange County after graduating from Concordia University in Irvine, Jaeger’s Santa Barbara roots show with his love of the city. He dreamed of starting a firm with his father before his unexpected death a few years ago. One day, Jaeger had a feeling to jump from Radius Group. That was a day after his second child was born.
Jaeger may have started his own brokerage and investment firm, Jaeger Partners, only about eight months ago when he left Radius Group after three years, but he’s a Santa Barbara native who understands the special case that State Street is for businesses of all sizes.
“We’re already seeing a transformation here,” Jaeger said over coffee in the 500 block of State Street. “New businesses on State Street bring a new lifeblood.”
National companies are sparking most of the change right now, though. Jaeger said Panera Bread filling the long-vacant Left At Albuquerque anchor of State and De la Guerra streets is a “done deal.” Another international company is eyeing a spot next to the Apple store in the 900 block of State Street, but Jaeger wouldn’t drop names yet.
Jaeger said many upscale chains use their stores here as a “loss leader,” something to promote a presence here despite the high rents and low sales volume, because they “just want to be in this area,” he said.
State Street rents are around $4 per square foot for a triple-net lease, and up to $8 a square foot in the sought-after 700 and 900 blocks. That’s still high in this market, Jaeger said, and makes even some national companies look elsewhere. Some landlords also lean toward big companies with strong financial support.
“Landlords have been more adaptive,” Jaeger said. “These people are often old Santa Barbara guys who want to root for the locals. At some point, lending will loosen and rents will fall enough that the two parties can meet in the middle.”
There are still types of stores State Street needs, Jaeger said. He said a sandwich shop such as the old Italian & Greek Deli and a bookstore are two notable gaps. Even in this economy, he said, State Street has an impressive 2 percent vacancy rate.
“Because of the lack of inventory,” he said, “there’s always going to be demand for retail space on State Street.”
Dealer Gets Chrysler Franchise Through Leveraging His Resources
If you want to buy something other than a Honda, Toyota or GM vehicle in Lompoc, you have to head out of town. But Lompoc Honda owner Christopher Zikakis will sell you a Chrysler, Dodge, Jeep or Ram truck after he breaks ground on a new showroom as early as December.
Zikakis announced Rocket Town Chrysler Dodge Jeep Ram last week, to be built on a parcel of land across from Lompoc Honda, at 1224 North H St. It’s the first time Lompoc has had a Chrysler Group outlet since 2008.
“Chrysler now that it’s combined with Fiat, is one of the hottest car companies in the world right now,” Zikakis said. “I personally can’t believe I’m saying this about Chryslers.”
Zikakis, who bought Lompoc Honda in 2007 after a career as an auto industry consultant, said data shows that for every 10 Hondas in the Lompoc area, there are seven or eight Chrysler Group vehicles. The American-Italian company has reported sales national sales increases every month for more than two years.
The Chrysler business will add 20 to 25 new sales every month, he said, eventually outstripping Honda’s 25 to 35 per month. He also expects to grow used car sales by about a third. Aggressive pricing will help.
“Everybody I know in Lompoc competes on price,” Zikakis said. “We are constantly drawing people in from other cities, miles away, because of price.”
Still, Zikakis only sees the new car franchises adding to his business, since he says there’s little overlap between Honda buyers and Chrysler buyers.
Chrysler, Dodge, Jeep and Ram vehicles will arrive in Lompoc in January or February, Zikakis said. The new vehicle lines will be serviced at the same department as Honda cars. In fact, Zikakis says he’s better utilizing his Lompoc Honda staff, such as accounting, finance and service employees. But the new showroom will get its own sales staff.
Zikakis said he’s open to adding another franchise under his stewardship down the road. If he does, it could set a positive trend for Central Coast auto dealers.
Now, when is Santa Barbara getting its Chrysler franchise back?
Carpinteria-Based CKE Reports Profit for Third-Straight Quarter
Carl’s Jr. and Hardee’s parent company CKE Restaurants has announced that profits for the second quarter, ending Aug. 13, were at $1.8 million, continuing a streak of growth for the South Coast fast-food company that’s been struggling in the aftermath of the recession.
CKE’s profit comes after a $2.2 million loss in the same period last year. Revenue was also up by 3 percent, to $308.6 million.
CEO Andy Puzder said he’s encouraged by the same-store sales growth from Carl’s Jr. and Hardee’s outlets across the country. But costs for other supplies for restaurants have slid in the past year, boosting profits for the company.
Puzder also said he’s positive on the momentum for the rest of the fiscal year.
Hayes Sells 32-Unit Complex
A new owner of an apartment complex is set to profit off some Santa Barbara City College students.
Hayes Commercial Group announced Monday in a news release the sale of a 32-unit apartment complex at 1035 Cliff Drive in Santa Barbara, steps from SBCC’s West Campus. The commercial real estate firm sees a trend in the sale of housing complexes with more than 20 units this year, with six of them being sold on the South Coast this year alone.
“Demand for multifamily property is currently outpacing supply on the South Coast,” Hayes agent Christos Celmayster said. “As a result we have seen more off-market transactions, and in some cases purchase prices have yielded cap rates below 5 percent, which is indicative of a seller’s market.”
The unnamed buyer was represented by Radius Group. The property sold for $6.77 million.