By Jon Peterson
Los Angeles-based CBRE has grown its office brokerage business in San Francisco by more than four times with its recent purchase of San Francisco-based The CAC Group. According to data supplied by CBRE, before the transaction was completed, CAC represented 14 million square feet of office space for landlords in San Francisco and, CBRE had 3.5 million square feet.
The 17.5 million square feet that these two firms have together represent more than 25 percent of the total supply of prime office building space in San Francisco.
CBRE was the driving force behind this deal. “We have known each other for many years working on opposite ends of many transactions since we were formed in 1990. They were the ones that approached us as for a potential deal together. As we got deeper along in the discussions, it became apparent to us that this could be something truly extraordinary; two companies, one local, one global, but both with very deep San Francisco roots,” says Bill Cumbelich, a principal and co-founder with CAC and now an executive vice president with CBRE.
“Once we started talking with them, it seemed that they would be a good fit for us and would allow us to grow CBRE in a meaningful way in San Francisco,” says Mike Smith, president of the Northwest region for CBRE. The area that he covers for the company includes the states of Washington, Oregon and Hawaii and Northern California.
Cumbelich sees that the sale of CAC will be very beneficial to their clients that are either buying properties or are tenants leasing space. “When it was just CAC, we could only service our clients within the city limits of San Francisco. This has all changed now—with CBRE, we can take our clients anywhere on the globe,” he said. CAC also had an active presence in other markets like Seattle and Bellevue, Wash.
CBRE is planning to keep all of the 140 employees who previously worked for CAC.
CAC represents many major institutional owners in the San Francisco market. One of these is New York City-based Vornado Realty Trust, one of the largest owners of office buildings in New York and Washington, D.C., and the 52-story, 1.5 million square foot 555 California Street in San Francisco. CAC recently closed leases with UBS, tech-star Supercell, Morgan Stanley, Loomis Sayles & Co. and Daiwa Securities Group.
Another example is the 542,743 square foot 333 Bush Street in San Francisco. This property is owned in a joint venture with San Francisco-based DivcoWest Properties and Boston-based AEW Capital Management. CAC is the exclusive leasing agent on the property.