There are Unicorns; you need to slow down a bit to see them

Back in March 2025, I wrote a blog post titled “Unicorns Found Grazing at a Prime Dev Site in Sacramento”. I talked about how the once-improbable dream of converting infill properties into school campuses was no longer a fantasy.

A Journey That Began in 2020

The site: 2331 Saint Marks Way, a 4.54-acre site with a 28,000 SF, eight-building campus nestled in a quiet Sacramento neighborhood near Watt and Butano.

The journey began in 2020, when I initially valued the property at approximately 65% of its ultimate selling price. At that time, we felt the odds of another school taking over the site was slim. But the market had other plans.

Zoning, Highest and Best Use, and Economics

Before bringing the property to market, I met with County planning officials to assess the highest and best use, as well as potential zoning pathways that could enhance the development potential of the site.

The property is currently zoned RD-5, which allows for roughly 22 single-family homes. Importantly, the zoning also permits a school use by right, but with a catch: the existing Conditional Use Permit (CUP) limits enrollment to just 135 students.

So I asked the obvious question: what would it take to either upzone the property or expand the CUP?

The County planner offered two paths:

• Upzone to RD-10: This would double the density but likely require 12 to 18 months to navigate. It would also incur significant soft costs, including those for engineers, design professionals, and legal representation.
• Upgrade the CUP to accommodate 350–400 students: This route could take just 8 to 12 months and would be substantially more cost-effective, since it doesn’t trigger the same level of consultant or entitlement expenses.

In short, the school path was faster, cheaper, and more aligned with the existing infrastructure.  Also, I had a hunch that the neighborhood would rather see the campus brought back to life than live through three years of redevelopment.

With that in mind, we made a strategic decision to narrow our initial marketing to educational users, with a focus on charter operators and nontraditional school formats.

Why lead with schools?  Time and money.

By targeting users who could move quickly and work within the existing zoning envelope, we increased our chances of a timely transaction. We eliminated months of uncertainty tied to speculative upzoning.

Phase 1 of our marketing focused exclusively on school operators, and the first call I made was to the Pacific Charter Institute. 

From Listing to Lease/Sale in six months

Our marketing forecast anticipated a transaction sometime in the first quarter of 2026.

Instead, we closed the deal in six months, but it took a Unicorn.  When Paul Keefer, the Executive Director of the Pacific Charter Institute, walked the property, he said, “This is a Unicorn.  You don’t find sites like this every day, let alone every 10 years.”  I always say, “You don’t need 20 buyers, you only need one, and in this case, the Pacific Charter Institute turned out to be the Unicorn we needed. 

The union of Pacific Charter Institute and 2331 St Mark’s Way is, in fact, the first documented marriage of two unicorns. 

Deal Structure

The structure: a lease with an option to purchase—a flexible format that allows PCI to activate the site quickly for limited enrollment this fall while simultaneously securing the upgraded CUP for more Students in 2026,

The most remarkable twist? PCI secured approval from the San Juan Unified School District Board in under 60 days, with a unanimous 6-0 vote. 

Policy Winds at Our Backs

This deal had momentum not just from market forces, but from legislation.

Thanks to Senate Bill 740, California offers qualified charter schools reimbursement for up to 75% of annual lease costs. To be eligible, a school must meet certain criteria related to student demographics and location. PCI’s plans appear to qualify under this program, which could significantly offset their facility costs.

And then came Proposition 2, passed by California voters in November 2024, which authorized $10 billion in state bonds, with $8.5 billion earmarked for K–12 schools, including charters. For organizations like PCI, this created access to capital for modernization and future acquisition.

The site at 2331 Saint Marks Way went from “unlikely to sell as a school” to “perfectly timed” almost overnight.

A Rotary Deal Through and Through

One of the things I’m proudest of is how Rotary relationships brought this deal together:

• Tom Bacon, CCIM (me), representing the owner.
• Paul Keefer, Executive Director of PCI.
• Chris Lemmon of Newmark, representing PCI, whose father and grandfather both served as Presidents of the Sacramento Rotary Club.

It’s a reminder that business done in the spirit of service and trust tends to find its way across the finish line.

Full Circle: From “Unicorns” to Real Results

The dream scenario is when public benefit and private opportunity align… These two unicorns might be rare, but they do exist, especially when the right people have the patience, vision, and creativity to make them real.

2331 Saint Mark’s Way is no longer a “what if.” It’s a reactivated campus, a new home for learning, and a success story made possible by strategy, timing, and a little bit of legislative tailwind.