San Jose real estate investors have completed a $176 million acquisition of One South Market, a 312-unit luxury community in the city’s downtown core. The deal was finalized by a joint venture between Kennedy Wilson, Hulic Co. Ltd., and Fuyo General Lease Inc. The buyer paid just $1 million more than the property’s previous owner, Lakevision Capital, paid for the site in 2020.
Property Details and Market Context
One South Market, located at 1 S. Market St., is a 23-story tower built in 2015. It sits in an Opportunity Zone and Difficult Development Area, just off California State Route 87 and across from San Pedro Square Market. The building includes floor-to-ceiling windows, central air conditioning, and smart thermostats in every unit. Shared amenities include a fitness center, pool, spa, and EV charging stations. The LEED Silver-certified structure also features two floors of parking and retail space.
San Jose’s multifamily market has seen significant growth over the last year. Sales that closed between October 2023 and September 2024 totaled $3.3 billion, with more than 6,500 units across 34 properties changing hands. The average price per unit reached $476,080. This represents a jump from the prior year, when transaction volume was $2 billion involving 5,500 units and an average price of $402,471.
Jones Lang LaSalle originated a $87.5 million, CMBS acquisition loan for the property, which matures in 2030. The deal was arranged by CBRE Senior Vice President Jon Teel on behalf of the buyer.
The new owners have a history of partnering on similar deals. Kennedy Wilson and Hulic first joined forces with Kenedix Inc. last summer to acquire The Danforth in Seattle for $173 million. In July, the two partners bought the 421-unit Carraway in West Harrison, N.Y., for $237 million, also alongside Kenedix.
While the price of $176 million is significant, it reflects a disciplined entry into a strong market. The previous owners acquired the asset six years ago for $175 million, paying just $1 million less than the current transaction. This tight pricing suggests that investors are calculating their returns based on long-term hold strategies rather than immediate flips. If the current owners had pushed for a higher price, the deal might not have cleared in the current competitive environment. The reliance on a CMBS loan maturing in 2030 further indicates a focus on holding the property through the next economic cycle.
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