By Jon Peterson
A private high net-worth owner has placed on the market for sale the 374,989 square foot office building in Oakland located at 1000 Broadway. The projected pricing on the sale is in the neighborhood of $400 per square foot, or $150 million, according to sources that are tracking the sale of major office assets in Oakland.
The seller has awarded the listing for the transaction to the JLL office in San Francisco. Those working on the sale include David Dokko and Erik Hanson, both senior directors, and Rob Hielscher, senior managing director. JLL declined to comment when contacted for this story.
The current ownership is putting the property up for sale for the first time. It has been the owner of the property since it was originally developed in 1982, according to sources that are familiar with the property.
The office building will be a good test to see the level of investor interest in a value-add asset that has some vacancy issues in the Oakland market. Most of the Class A office buildings that have been sold recently have been those that were leased to a single tenant with strong credit.
1000 Broadway is an office building with a current occupancy of around 50 percent. The property does have an average remaining lease term of 2.2 years with 29 percent cumulative lease rollover in the next 24 months. The current tenants in the property have leases that are roughly 30 percent below market.
One potential opportunity for the new ownership exists on the fifth and six floors of the property. Both of these spaces could be taken over by an anchor tenant, since these floors have contiguous space with nearly 65,000 square feet on the fifth floor and 40,000 on the sixth floor. There are currently 27 active requirements targeting 20,000 square feet or larger in the East Bay, according to industry sources. One of these is Twitter, which is looking for 80,000 square feet in Oakland.
Over the past three years, the sellers have invested a total of $6.5 million to improve the asset, according to industry sources. Some of the work done to the property includes elevator modernization, restroom remodel and window covering replacement. The office building now includes with it two subterranean parking levels with a total of 376 stalls.
1000 Broadway has a good mass transit location, as well. It sits about two blocks from the 12th Street BART station and is also near AC Transit stops.