(EDITOR’S NOTE: The buyer is Hines with capital partner Oaktree Capital Management, according to multiple industry sources familiar with the transaction. The firms paid about $195MM, or about $438 per square foot. Shorenstein worked with Newmark Knight Frank’s Phil Mahoney and Michael Saign on the deal along with CBRE as the market advisor.)
SAN FRANCISCO — Shorenstein Properties LLC (“Shorenstein”), an owner and operator of high-quality office, residential and mixed-use properties across the U.S., today announced the sale of Santa Clara Towers to an undisclosed institutional investor. The terms of the transaction were not disclosed.
Prominently located along Highway 101 in the Golden Triangle submarket of Santa Clara, the more than 445,000 square-foot property comprises twin Class A office towers capable of accommodating a range of full floor and multi-tenant configurations. Santa Clara Towers offers convenient access to Route 237 and Interstate 880 and is in close proximity to major hotels, universities and San Jose International Airport.
“We are excited to have reached this agreement for the sale of Santa Clara Towers,” said Jed Brush, Senior Vice President at Shorenstein. “I am confident that under new ownership, Santa Clara Towers will continue to attract a diverse mix of tenants who seek a Class A office experience in the heart of Silicon Valley.”
Shorenstein’s Ninth Fund initially acquired the mezzanine loan on Santa Clara Towers from Lehman Brothers in 2008, and then through a deed in lieu of a foreclosure transaction assumed ownership of the property in 2010. Shorenstein has invested capital to make a number of enhancements to the property, including a full lobby renovation at Tower II, new corridor lighting and elevator finish upgrades. These improvements accompany a strong suite of onsite amenities such as a newly renovated fitness center, indoor pool, spacious parking structure and the iconic Birk’s Restaurant, among others.
Russell Ingrum, Joe Moriarty, Scott Prosser and Jack DePuy with CBRE represented Shorenstein in the transaction.
About Shorenstein Properties LLC
Founded in 1924, Shorenstein Properties LLC is a privately-owned, real estate firm that owns and operates high-quality office, residential and mixed-use properties across the U.S., with offices in San Francisco and New York. Since 1992, Shorenstein has sponsored twelve closed-end investment funds with total equity commitments of $8.8 billion, of which Shorenstein committed $723.5 million. The firm uses its integrated investment and operating capabilities to take advantage of opportunities that, at the particular time in the investment cycle, offer the most attractive returns. Investments have included ground-up developments, asset repositioning and stabilized assets; investment structures have included asset acquisitions, mezzanine loans, preferred equity investments and structured joint ventures. These funds have invested in properties totaling 67 million square feet in transactions with a gross investment value in excess of $16 billion.
About CBRE Group, Inc.
CBRE Group, Inc., a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2018 revenue). The company has more than 90,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 480 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services.