KBS Feeds Bay Area’s Hungry Office Market with Another Purchase
- Jan 06, 2015
KBS Real Estate Investment Trust III has acquired The Towers at Emeryville, a three-building, Class A office property in Emeryville, Calif., from a joint venture of LBA Realty L.L.C. and Starwood Capital Group L.L.C. for a reported $248 million.
The transaction was an 8-K SEC filing.
The 815,018-square-foot property is located directly across the bay from San Francisco on a waterfront location.
“We are starting to see a significant inflow of tenants from San Francisco,” Rodney Richerson, KBS’ Western regional president, told Commercial Property Executive. “The rent differential between San Francisco and the East Bay is at an all time high and we believe that the migration to the East Bay will accelerate.”
Originally constructed between 1972 and 1985, The Towers were renovated in both 1998 and 2012. KBS plans to make additional changes and renovations almost immediately.
“LBA has done a great job amenitizing the assets and we will continue with the theme,” Richerson said. “We plan on spending $10 million on property improvements including restroom upgrades, common area corridors, the addition of a tenant lounge and a 50-100 person conference facility.”
Currently, the property is occupied by a tenant roster that includes AAA of Northern California, Gracenote, Inc., Sutter Health and Berkeley Research.
The property is close by transit, plus 25 restaurants and bars and four hotels are located within walking distance.
In addition to The Towers, KBS and its affiliated companies currently own 10 properties in the greater Bay Area totaling more than 2 million square feet.
Last month, KBS entered the Silicon Valley market with the acquisition of Ten Almaden, a 309,200-square-foot office property in downtown San Jose, Calif. The company’s lengthy list of transactions over the last 12 months includes the $170.5 million acquisition of the approximately 427,000-square-foot 222 Main office tower in Salt Lake City, and the purchase of 171 17th Street, a 500,000-square-foot office building in Atlanta, for $132.5 million.