KKR Acquires Office Development in Oakland, CA
- Jul 31, 2018
KKR has acquired 1330 Broadway, a 320,000-square-foot office building in Oakland, Calif., from TMG Partners.
Financial details were not disclosed, though reports reveal the price was north of $173 million. TMG Partners acquired the 1958 building in 2015 for $80 million from Myron Zimmerman Investments.
Since that time, the company oversaw a major redevelopment of the property on behalf of its investor, a sovereign wealth fund. Renovations included upgrading the lobby and building entrance, modernizing the elevator and building systems, adding new common area finishes, enhancing the conference facilities and adding bike parking and commuter showers.
As part of the deal, TMG will invest in a new partnership with KKR, and will continue with onsite property management and asset management for the building, handling leasing and capital improvements at the property.
“It is gratifying to have been able to revitalize one of downtown Oakland’s best buildings,” Michael Covarrubias, TMG’s chairman & CEO, said in a prepared statement. “The redevelopment of this urban infill, transit-oriented building has only strengthened our commitment to Oakland and our tenants at 1330 Broadway. We look forward to being partners with KKR as we continue to manage the property.”
Current tenants include Oracle, Arup, Clovis Oncology, UCSF, Verizon, Chase Bank and Citizens Engagement Lab.
The property is located at the 12th St., Oakland BART station, which is directly served by AC Transit.
Activity in Oakland
The deal represents KKR’s second investment in the Oakland market.
“We believe Oakland has attractive long-term secular growth trends driven by its accessibility to transit, a growing retail amenity base, and a meaningful amount of residential development,” Justin Pattner, KKR’s head of real estate equity in the Americas, said. “TMG has successfully repositioned the property into a top building in Oakland, and we look forward to the next phase of the leasing business plan.”
TMG is also bullish on Oakland. In 2017, TMG acquired 2201 Broadway, an eight-story, 198,000-square-foot office building in Uptown Oakland. The company is also entitling an almost 750,000-square-foot office and retail tower at the intersection of Grand and Telegraph Avenues.
Image courtesy of TMG Partners