Pacific Coast Business Times
08/24/2007
by: Barbara Pearson

An undisclosed local investor with other retail holdings in Santa Barbara has purchased the 8,060-square-foot ground-floor level of the newly constructed Paseo Chapala, 721 to 739 Chapala St., Santa Barbara, equipped with 280 feet of street frontage and underground parking.

The last listed sale price was $5.9 million.

Brad Frohling of Radius Group Commercial represented the buyer and Brian McCririe and Steve Hayes of Leider Hayes Commercial represented the seller, Bermant Development.

Esau’s coffee shop, formerly on lower State St., has signed a lease for a quarter of the space, set to open by the end of the year with options to stay at the site for up to 25 years.

The roughly 1,700-square-foot restaurant will include a patio area.

The owner of Esau’s for 29 years, Scott Stanley, said he plans to add dinner to his offerings at the Santa Barbara location “because it takes a full 16 hours to make it a profitable business.”

The restaurant has traditionally been open just for breakfast and lunch hours, but Stanley said that times have changed and quality space comes at a high price. He said the new site will attract fans of Esau’s food that stopped coming to his former Santa Barbara location as it fell into disrepair.

Despite the welcome presence of a classic Santa Barbara eatery, the retail center will doubtfully become a haven for mom and pops displaced by the increasing rents cause by State Street’s growing popularity.

Though subject to change, asking prices for retail suites in Paseo Chapala, as listed on the Radius Group website, are $7,000 per month for 1,151 square feet, $3,500 per month for 507 square feet and $4.25 NNN for a 4,304-square-foot restaurant space,

“The rents we’re going to end up getting will be very similar to State Street,” said Radius broker Brad Frohling.

He said despite high rents, the center will cater to boutique-type retailers by offering suites as small as 600 square feet, which is difficult to find in the area.

Because of its proximity to the Paseo Nuevo mall, Frohling said the mix of tenants at Paseo Chapala - which should include both national and regional retailers - will be designed to bring in high traffic and an upscale market. He said he hopes to secure a lunch and dinner restaurant for the second restaurant space, to keep a good bustle at the site throughout the day and evening.

CASTILIAN CENTER

An open house was held for the Castilian Research & Technology Center, 55 Castilian Drive, Goleta, on Aug. 15, introducing more than 37,000 square feet of incubator space in the heart of one of the region’s major technology hubs. Formerly the corporate headquarters for Hendry Telephone, the site has been completely renovated to give start-up businesses a chance to operate amid big boys such as Cisco, Network Hardware, Raytheon, Cottage Hospital, DuPont and FLIR?Systems.

Tenants can lease work stations for as little as $375 per month including utilities, private offices for up to $900 per month including utilities and furniture and units priced from $3,780 to $5,875 plus electricity.

Prices include reception service, parking and access to a fax machine, copier, postage meter and kitchen as well as conference and shipping rooms. Internet and telephone services are available.

Francois DeJohn and Kristopher Roth of Leider Hayes Commercial are the brokers for owner BDC Development.