Equity Sells 2 Suburban San Francisco Office Properties for $100M
- Feb 27, 2014
Equity Office Properties Trust has been in a selling kind of mood in certain locations and it recently pocketed $100 million on the disposition of two office assets totaling 212,900 square-feet in Marin County, across the bay from San Francisco. EOP sold Drake’s Landing in Greenbrae to a life insurance company and Wood Island in Larkspur to real estate company Harrigan, Weidenmuller Co.
Drake’s Landing is a 130,200-square-foot office complex carrying the addresses of 100, 300, 500 Drakes Landing Rd. The three-building property, developed in 1986, is 99 percent occupied. The two-building, 82,700-square-foot Wood Island, located five miles to the north at 60-80 East Sir Francis Drake Blvd., made its debut in 1975 and is presently 95 percent occupied.
Commercial real estate services firm Jones Lang LaSalle marketed the assets on EOP’s behalf. “The properties are located in a very supply constrained market and provide stable in-place cash flow, diverse tenant rosters and upside potential through the ability to increase rents as the market continues to tighten,” Michel Seifer, managing director with JLL, said in a prepared statement.
All parties involved are remaining mum on the financial details of the transactions, but according to industry players familiar with the deals, Drake’s Landing and Wood Island fetched approximately $60 million and $40 million, respectively. The price tags of more than $450 per square-foot reflect the status of the properties, as well as a growing interest in the market among investors. According to a report by commercial real estate services firm Cassidy Turley, from January 2010 until January 2013, there were only 13 office sales in Marin of buildings of more than 10,000 square feet, and those transactions averaged a price of $123 per square-foot. The average sale price in the area in 2013 was $269 per square-foot. Among those transactions was Shoreline Office Center, a 98,700-square-foot asset in Marin County’s Mill Valley, which EOP sold to Basin Street Properties for nearly $22.3 million, or roughly $225 per square-foot
It’s certainly been a busy winter of disposition activity for EOP. In January, news emerged that the Blackstone Group affiliate had sold Center Plaza, a 717,100-square-foot, transit-oriented mixed-use property in downtown Boston, to Shorenstein Properties L.L.C for $307 million. In December, the company sold 225 West Santa Clara, a 349,318-square-foot, transit-oriented trophy office destination in downtown San Jose, Calif., to a joint venture between Principal Real Estate Investors and Harvest Properties. And in the same month, EOP traded the 649,184-square-foot Wellesley Office Park, in the suburban Boston town of Wellesley for $237 million.
Surely, there’s more to come.