Patricia Robinson and Ron Van Wagner Win Borelli Broker “Race”— Get Luxury Treatment and Exclusive Trackside View

The San Jose Grand Prix is indeed “more than a race” as its slogan declares. While Sebastien Bourdais was steering his #1 McDonald’s Ford-Cosworth/Lola/Bridgestone to victory on the tight 1.44 mile downtown circuit, Canary Foundation was raising approximately $1,070,000 to further its goal of finding new ways to detect cancer at its earliest, most curable stages.

Meanwhile, Borelli Investment Company was doing its part to support both the race and the fundraising efforts. Ralph Borelli auctioned rides in his vintage #22 Maxwell House stock car—a former pole sitter at the NASCAR Daytona 500—with all the money going to the charity.

In addition, the company offered a series of prizes for anyone who closed a deal or referred leads for office condominium sales, sales and leases of other Borelli properties, or property management contracts. First through third place awards included seats in Borelli Investment Company’s two-story, luxury trackside suite, pit crew access, cash vouchers, and for the grand prize winners—rooms for the weekend at the Hilton hotel. Everyone who closed a deal or made a referral got grandstand seats to see the race.

The top producers for 2006 were brokers Patricia Robinson and Ron Van Wagner of Grubb & Ellis, who worked together on a transaction to purchase office condo suites 128 and 138 at Borelli’s Junction Office Center in San Jose.

Congratulations to Patricia and Ron, and thanks to all who contributed to Canary Foundation or supported this great motor sports event that continues to gain traction in San Jose. See you at the starting line next year!

For years, Morgan Hill residents have had to do the majority of their shopping in neighboring communities to the north or south—San Jose or Gilroy. Little did they know that behind the scenes, Borelli Investment Company was quietly looking for a way to put together a land transaction that would lead to the largest retail project in Morgan Hill’s history.

In 1976, Ralph Borelli began talking to a group of landowners, including the Guglielmo family of the winery that bears its name, about selling their land for development. Various obstacles arose—complications due to land being passed from one generation to another, entitlement issues, and zoning changes—and nothing happened. At one time or another, other developers tried to build homes and then office buildings, but each time, failed negotiations and litigation caused the land to remain barren.

Then, not quite three years ago, Borelli saw another opportunity. Negotiations began again, with J.P. DiNapoli Companies, Inc. and Browman Development Company laying plans for a contemporary 650,000 square foot, 66-acre retail center anchored by a Super Target store. After nearly three decades of behind-the-scenes spadework, Borelli was finally able to bring together the patchwork of parcels to complete the land transaction and pave the way for construction to begin.

“One parcel had been owned by the Guglielmo family for more than 80 years,” said Borelli. “Another parcel had multiple owners with varying interests and concerns. Finding the right terms to ensure the transaction was acceptable to all the landowners and the developers, and would also meet the city’s general plan provisions, was not easy.”

Perfect Fit for Morgan Hill

The new shopping center will feature retail businesses that will minimize competition with Morgan Hill’s revitalized downtown. Its contemporary, art deco design will also set it apart from the traditional indoor mall or “big box” retail centers surrounded by acres of concrete and asphalt. The buildings will be very colorful, washed in bright earth tones that fit well with the surrounding hills and valley floor. Shoppers will enter off Cochrane Road by driving up a main boulevard that runs between the buildings. The buildings will also be connected by pedestrian walkways with courtyard-like gathering places.

In addition to the 127,000 square foot Target, major anchor tenants signed for the center include Petco, Staples, and Cost Plus World Market. Shoppers can also expect a choice of national restaurant chains. The center is scheduled to open in the summer of 2007.

“We wanted to bring the South Valley something unique,” said John B. DiNapoli, vice president of JP DiNapoli Companies. “This center will offer South Valley residents a shopping experience they can’t find elsewhere.”

Persistence Pays Off

The 30-year effort to secure a deal was the longest of Ralph Borelli’s career, which has been marked by numerous awards for his ability to complete complicated land transactions.

“Sometimes, it just takes time,” commented Borelli. “Very few land transactions in Silicon Valley are simple any more. Fortunately, our firm has the skills and experience to keep working on a transaction like this and help make a much needed shopping center a reality.”

 Named Best Renovated Building of 2006 by Building Owners and
Managers Association – Silicon Valley

San Jose, Calif., October 18, 2006 — Borelli Investment Company’s Junction Office Center, a two-building, 77,000 square foot office condominium complex at 2051-2055 Junction Avenue in North San Jose, has been named Best Renovation of 2006 by the Building Owners and Managers Association (BOMA) Silicon Valley. Offering 52 units from 750 to 3,000 square feet,JunctionOfficeCenterhas been another in a series of successful business condominium projects for Borelli, with more than 50 percent of the complex already sold or in escrow. Businesses can buy—not lease—space at Junction, and enjoy all the tax benefits and potential long-term appreciation usually available only to larger organizations capable of purchasing an entire building.

Originally built in 1984, the two two-story buildings set around a central courtyard had aged significantly over the years. Borelli Investment Company invested nearly $10 million in the renovation, completing a sweeping upgrade that included a new roof, sophisticated new heating and air conditioning system that offers better zone control and greater efficiency, upgraded elevators, completely redone restrooms with showers, ADA improvements, a full seismic retrofit, a new parking lot, and extensive landscaping. A new facade brought out the sweeping glasslines and saw the addition of awnings over the two entrances. The elegant lobbies feature high ceilings and polished granite floors, with a number of works of art as added touches.

“Borelli Investment Company has a distinguished reputation for the work they do in commercial real estate development and management,” said Robert Jacobvitz, executive director of BOMA Silicon Valley. “The judges were impressed with the high quality of the retrofit.JunctionOfficeCenterhas a unique role as an office condominium created from old concrete tilt-up buildings. This is a very good example of Borelli’s innovative business model, and may be the wave of the future inSilicon Valley.”

Many Business Conveniences

Each of the 52 office suites is fully carpeted and includes a coffee bar with sink and cabinets. Condo owners are provided individual controls for heating and air conditioning, have separate metering for electrical usage, and enjoy high-speed web browsing and Internet access over the building’s T1 line as part of their regular association dues. Additional customizing is easy, because businesses own, not rent, the space.

All owners can use the state-of-the-art common conference room with the latest meeting support tools such as large-screen video, Web-based videoconferencing, audioconferencing, and PowerPoint capabilities.

JunctionOfficeCenter’s location in the heart of the technology-rich Golden Triangle—formed by the intersections of I-880, Hwy 101, and Hwy 237—reduces commutes and makes it easy to see clients any time of the day. The complex is close to a VTA light rail station and a short drive toMinetaSan JoseInternationalAirport. The generous parking ratio of 5.3 spaces per 1,000 square feet provides plenty of spots for employees and customers, and on-site services include UPS, FedEx, and US Postal Service drop boxes.

“We are so enthusiastic aboutJunctionOfficeCenterthat we recently purchased several units and moved our company into 5,500 square feet of space there,” remarked Tom Purtell, chief operating officer of Borelli Investment Company. “We are pleased to have been chosen by BOMA Silicon Valley for this honor, and think this speaks to the quality and attention-to-detail owners will find at Junction. This is an office smaller businesses will want their customers to visit, again and again.”

Interested businesses can learn more about JunctionOfficeCenterby contacting Larry Bengiveno at Borelli Investment Company at (408) 453-4700 or larry@borelli.com.

About BOMA Silicon Valley
BOMA Silicon Valley has served the commercial real estate industry for over 22 years. Founded in 1983, BOMA Silicon Valley today represents well over 75 million square feet of commercial real estate inSilicon Valley. The Association is dedicated to professional, ethical property management and provides its members with legislative advocacy, industry information, educational opportunities, and a forum for networking with peers.

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 property 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 going to www.borelli.com

Contact:
Buddy Parsons, President
Borelli Investment Company
2051 Junction Avenue, Suite 100
San Jose, CA 95131
Ph: 408.453.4700
Fax: 408.453.4636
E-mail: info@borelli.com
http://www.borelli.com

Borelli’s Junction Office Center Wins BOMA Award Named Best Renovated Building of 2006 by Building Owners and  Managers Association – Silicon Valley

San Jose, Calif., October 18, 2006 — Borelli Investment Company’s Junction Office Center, a two-building, 77,000 square foot office condominium complex at 2051-2055 Junction Avenue in North San Jose, has been named Best Renovation of 2006 by the Building Owners and Managers Association (BOMA) Silicon Valley. Offering 52 units from 750 to 3,000 square feet, Junction Office Center has been another in a series of successful business condominium projects for Borelli, with more than 50 percent of the complex already sold or in escrow. Businesses can buy—not lease—space at Junction, and enjoy all the tax benefits and potential long-term appreciation usually available only to larger organizations capable of purchasing an entire building.

Originally built in 1984, the two two-story buildings set around a central courtyard had aged significantly over the years. Borelli Investment Company invested nearly $10 million in the renovation, completing a sweeping upgrade that included a new roof, sophisticated new heating and air conditioning system that offers better zone control and greater efficiency, upgraded elevators, completely redone restrooms with showers, ADA improvements, a full seismic retrofit, a new parking lot, and extensive landscaping. A new facade brought out the sweeping glasslines and saw the addition of awnings over the two entrances. The elegant lobbies feature high ceilings and polished granite floors, with a number of works of art as added touches.

“Borelli Investment Company has a distinguished reputation for the work they do in commercial real estate development and management,” said Robert Jacobvitz, executive director of BOMA Silicon Valley. “The judges were impressed with the high quality of the retrofit. Junction Office Center has a unique role as an office condominium created from old concrete tilt-up buildings. This is a very good example of Borelli’s innovative business model, and may be the wave of the future in Silicon Valley.”

Many Business Conveniences

Each of the 52 office suites is fully carpeted and includes a coffee bar with sink and cabinets. Condo owners are provided individual controls for heating and air conditioning, have separate metering for electrical usage, and enjoy high-speed web browsing and Internet access over the building’s T1 line as part of their regular association dues. Additional customizing is easy, because businesses own, not rent, the space.

All owners can use the state-of-the-art common conference room with the latest meeting support tools such as large-screen video, Web-based videoconferencing, audioconferencing, and PowerPoint capabilities.

Junction Office Center’s location in the heart of the technology-rich Golden Triangle—formed by the intersections of I-880, Hwy 101, and Hwy 237—reduces commutes and makes it easy to see clients any time of the day. The complex is close to a VTA light rail station and a short drive to Mineta San Jose International Airport. The generous parking ratio of 5.3 spaces per 1,000 square feet provides plenty of spots for employees and customers, and on-site services include UPS, FedEx, and US Postal Service drop boxes.

“We are so enthusiastic about Junction Office Center that we recently purchased several units and moved our company into 5,500 square feet of space there,” remarked Tom Purtell, chief operating officer of Borelli Investment Company. “We are pleased to have been chosen by BOMA Silicon Valley for this honor, and think this speaks to the quality and attention-to-detail owners will find at Junction. This is an office smaller businesses will want their customers to visit, again and again.”

Interested businesses can learn more about Junction Office Center by contacting Larry Bengiveno at Borelli Investment Company at (408) 453-4700 or larry@borelli.com. Businesses can also visit the web site at www.junctionofficecondos.com.

About BOMA Silicon Valley         BOMA Silicon Valley has served the commercial real estate industry for over 22 years. Founded in 1983, BOMA Silicon Valley today represents well over 75 million square feet of commercial real estate in Silicon Valley. The Association is dedicated to professional, ethical property management and provides its members with legislative advocacy, industry information, educational opportunities, and a forum for networking with peers.

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 property 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 going to www.borelli.com

Contact: Buddy Parsons, President Borelli Investment Company   2051 Junction Avenue, Suite 100 San Jose, CA 95131 Ph: 408.453.4700 Fax: 408.453.4636 E-mail: info@borelli.com

http://www.borelli.com

If you are a real estate investor, here’s a question: when did you last review your real estate portfolio? Just like your stock portfolio or insurance policies, your real estate investments should receive an annual review.

Markets change, properties age, interest rates move up and down — all these factors make it a good idea to sit down with a professional and review your real estate investments regularly. In this issue of Borelli Investment Company’s Commercial Real Estate Insider, we provide four tips for your next review.

“It just makes good sense to do a comprehensive review of your real estate investments, from time to time,” explained Ralph N. Borelli, chief executive officer of Borelli Investment Company. “This will better enable you to decide whether to stand pat, or reposition or redeploy any of your invested capital.”

Tips for a Successful Real Estate Investment Review

• Learn the ABCs about ROE
• Estimate projected income going forward
• Evaluate capitalization rates
• Go beyond the numbers

The ABCs of ROE

The first thing you should do is analyze your return on equity (ROE) on an annual basis. This is really the return on imputed equity—based on the expected sales price of a property, less debt and closing costs. By dividing your current cash flow by the imputed equity you have in a property, you can calculate your current ROE.

“Many people will hold a property for years, never realizing that the annual ROE is two or three percent,” Borelli explained. “Holding a property for another year is a little like buying it again; there are other investment opportunities for that money. So, if you’re aware of what your return is, you can make better decisions.”

Crystal Ball Gazing – With Help

The next step involves evaluating a property’s rent prospects going forward, over perhaps one to five years. This type of crystal ball gazing is best done with the help of a real estate investment professional you trust.

“If you anticipate that rents will rise or fall—driving your ROE higher or lower—this could impact your decision of whether to hold or sell a property,” commented Borelli. “Looking ahead is critical, because it helps to stay ahead of the herd when buying or selling.”

Other important considerations include whether major capital expenditures will be required for roofs, mechanical systems, structural improvements, parking lots, or similar upgrades. In addition, lease roll-over exposure can significantly impact your operating cash flow.

Calculating the Cap Rate

Step three in a detailed analysis involves computing the capitalization (cap) rate, another measure of value in real estate investments. The cap rate is calculated by dividing a property’s annual net operating income over its projected sales price.

While it was common a few years ago for cap rates to be 8.5 to 9.0 percent, those rates have declined recently as investors appear willing to pay more to buy properties producing less net operating income. The cap rate can be very helpful in gauging the appetite of buyers before deciding whether to sell or hold a property.

Going Beyond the Numbers

The final step in analyzing your real estate investments has nothing to do with numbers. Instead, it has everything to do with you and your life objectives and circumstances. Sometimes, a decision to sell may be driven by estate planning needs, or gifting desires. You may simply be at a point where you want to slow down a bit, and reduce your risk, or the opposite—where you are willing to assume more risk in hopes of earning a higher return. Or, you may simply decide it’s time to do something else with your money. Any of these reasons could be valid considerations in reviewing your real estate portfolio.

“At Borelli Investment Company, we work with many clients to help them review their holdings as needed,” Borelli said. “A regular review of your investments will help ensure that your portfolio keeps working hard for you, through up and down cycles year after year.”