TMG Partners, KKR Acquire Office Building in Downtown Oakland for $255M
OAKLAND, CALIF. — TMG Partners and KKR have purchased 1221 City Center, an office tower in downtown Oakland that houses the global headquarters of Clorox.
The sales price was not disclosed, but the San Francisco Business Times reports the Swiss financial giant UBS AG (NYSE: UBS) sold the office tower for $255 million.
The business publication also reports that this is the third time that the 24-story building has traded in the past six years. In 2012, Clorox Co. sold the asset for $110 million.
Located at the intersection of Broadway and 12th Street, the 522,000-square-foot office building was 99 percent leased at the time of sale to various tenants, including Union Bank, Stanford Health Care, Wells Fargo Bank and Parsons Brinkeroff.
The LEED-Platinum certified building offers direct access to Bay Area Rapid Transit (BART) in its lobby, one of only three Oakland office buildings with that amenity. The property also features panoramic views of the Oakland skyline and the Bay, as well as onsite retail amenities, bike lockers, showers and parking.
This acquisition is the second transaction by TMG and KKR in Oakland this year, following the purchase of 1330 Broadway in July. KKR is making the investment through its Real Estate Partners Americas II Fund.
TMG Partners is a developer, manager and investor based in San Francisco. The company has two other investments in the Oakland area: 2201 Broadway, an eight-story 198,000-square-foot office building in Uptown Oakland that the firm bought last year; and an approximately 750,000-square-foot office and retail tower at the intersection of Grand and Telegraph avenues that TMG is currently entitling.
“We expect that the Oakland office market will continue its positive trajectory because of strong tenant demand and extremely limited supply,” says David Cropper, director of development for TMG. “We look forward to broadening our partnership with KKR in the future.”
Oakland’s downtown office submarket continues to report a decrease in overall office vacancy, falling from 3.8 percent in the second quarter to 3.2 percent in the third quarter, according to data from Colliers International.
TMG has developed more than 25 million square feet of commercial properties throughout the San Francisco Bay Area.
KKR is a global investment firm based in New York City that manages multiple asset classes, including real estate, private equity, energy, infrastructure and credit, with manager partnerships that manage hedge funds.
— John Nelson and Amy Works