A little more than a month after employees were first told that the landmark Sunset campus was up for sale, the property has been sold to Embarcadero Capital Partners, a real estate investment and management firm based in Belmont, multiple sources told the Almanac.
The seven-acre campus, located at 80 Willow Road, reportedly sold for $78 million, less than the rumored asking price of $84 million, according to those sources.
During informal discussions with staff about the sale on Wednesday, Dec. 10, management was said to confirm that there was pressure from shareholders of Time Inc., which owns the Sunset brand, to meet fourth quarter earning expectations. A plan to build high-density condominium type housing on the site "was alluded to."
Representatives from Embarcadero Capital Partners were not immediately available for comment. The firm's website lists primarily office space in its portfolio, although it does include one residential project, located in Sacramento.
Jill Davison of Time Inc. said she could not confirm the sales price or future plans for the site.
Building housing on the site would require a zoning change, as the code currently permits administrative and professional offices.
"I can say with all confidence that it would be an uphill battle and not something I would support," said Menlo Park Economic Development Manager Jim Cogan. "A project like that would require a general plan amendment and zoning change. Neither of which are likely."
There's also the potential historic nature of the site, according to Mr. Cogan, who said that any project would have to provide the city with an analysis of existing historic resources on the property.
"While it's premature to speculate on what a report might deem historic, I assume there will be some amount of preservation required of any project," he said.
Residential architect Cliff May designed his first commercial building to resemble an early Spanish ranch home. Set on seven acres adjacent to San Francisquito Creek, the adobe building with the patios and test kitchens was surrounded by spacious gardens designed by Thomas Church.
The sale to Embarcadero Capital Partners puts an end to Menlo College's exploration of buying the property to both expand its school and preserve the unique features of the Sunset campus.
The magazine will remain at the Willow Road property through 2015, and the annual "Sunset Celebration Weekend" event is still planned for next summer, sources said.
The publication is said to be looking for alternate sites for its test garden and kitchen.
In 1951, Sunset moved from San Francisco to its iconic campus in Menlo Park. The following year Bill and Mel Lane took over company operations from their father, Laurence W. Lane, who had bought the publication for $65,000 in 1928 when it was a fledgling travel magazine. The Lane brothers sold the company to Time Warner in 1990 for $225 million.