In 2009 when global chip manufacturer Inter purchased Wind River Systems, the acquisition came with an office complex and a development site in Alameda where the organization was headquartered. Spread across four buildings located at 300-600 Wind River Way, the property went on the market earlier this year through the efforts of Newmark Knight Frank and Grant Lammersen who led the sales effort at the company. According to public documents, San Francisco-based Simeon Properties purchased the asset for $60,450,000 in a sale that closed on June 30, 2017. The four buildings totaling 259,019 square feet sold for $56,180,000, or roughly $217 per square foot, while the development site, which is approximately 3.6 acres, sold for $4,270,000. This site can be developed into a four-story, 96,000 square foot building.
According to the offering documents, two of the four properties, buildings 300 & 400 are full, while buildings 500 & 600 are vacant. This came as a result of job consolidations following the acquisition. According to a report from the San Francisco Business Times, Simeon Properties has plans to spend between $15 million and $20 million to renovate the two vacant buildings. CBRE was attained to help lease out the properties. The Wind River buildings sit on the Brooklyn Basin, on the opposite side of the water way where Signature Development is breaking ground on the $1.5 billion, 65-acre project that when finished will feature 3,100 units, 32 acres of open parks and trails, a 200-boat slip marina and a retail destination.
Alameda is not a very large market. According to a second quarter of 2017 report from brokerage firm Kidder Mathews, the city’s total inventory is approximately 3.8 million square feet. A notable recent acquisition was the 1451 Harbor Bay Parkway property in Alameda; the 86,055 square foot Class B building, which is fully leased to Kaiser Permanente, went to Legacy Property Management for $20 million or $232 square foot.
The report shows that the submarket trails in vacancy from the overall East Bay office market with 12.1 percent of vacancy, while the average vacancy for the entire East Bay region is at 8.8 percent, according to the report. As a result, asking rates are almost 34 percent lower than average rates for the region. In Alameda they are at $1.88, while the average rate for the East Bay market sits at $2.84.