OAKLAND — A big office complex in Oakland has been seized through a foreclosure that slashed the building’s value to one-third of its prior price, fresh evidence of a sickly post-COVID Bay Area real estate market.
The two-building office center is located at 303 and 333 Hegenberger Road in Oakland, a location that’s in a prime corridor and gateway to the city’s airport.
In 2019, an affiliate whose primary member is Walnut Creek-based Vertical Ventures, one of the Bay Area’s savvy real estate investment and development firms, paid $40.6 million for the office complex.
The Landing, as the Oakland office center is known, now appears to be worth considerably less than that following the foreclosure, according to documents filed on June 14 with the Alameda County Recorder’s Office.
Ares Commercial Real Estate Management, the property’s lender that acted through an affiliate, took ownership of the office complex through a foreclosure that valued the building at $14.75 million.
This means that the foreclosure-triggered value for the office complex was 63.7% below the price that was paid for the property in 2019.
The loan that went into foreclosure totaled $37.5 million at the time Ares Commercial Real Estate Management issued the financing to the Vertical Ventures affiliate in 2019.
The office complex totals about 198,200 square feet, according to a marketing brochure that was circulated by Cushman & Wakefield, a commercial real estate firm.
The property consists of an eight-story office building at 333 Hegenberger Road that totals 142,800 square feet and a four-story building at 303 Hegenberger Road that totals 56,000 square feet.
Vertical Ventures described The Landing as an office center at a choice site.
“This is a desirable Oakland location easily accessible from Oakland International Airport and Interstate 880,” Vertical Ventures stated on its website as of this week.