TMG Partners has won awards for many projects
including honors for “Best Mixed Use,”
“Best Office,” and “Best Historic Rehabilitation”.
The official price for PG&E Corp.’s acquisition of the 910,000 square foot tower that houses the firm’s headquarters in Oakland has been identified. According to a regulatory filing, the purchase price of the property will be $906 million, or approximately $995 per square foot. The firm has agreed to make payments of $150 million by July 11, 2023, $250 million on or before July 11, 2024, and the remaining $506 million at closing in June 2025.
Additionally, according to the filing, a $75 million option payment letter of credit was returned to PG&E. The company will also receive a credit of approximately $172 million towards the final payment, subject to adjustments.
Located at 300 Lakeside Drive, the tower was formerly known as the Kaiser corporate headquarters building. The 29-story asset also includes a parking garage with a rooftop garden, as well as roughly 130,000 square feet of office and retail space.
As part of PG&E’s relocation from San Francisco to Oakland, the company secured a 35-year lease on the property with an option to purchase its new home at Lake Merritt, according to The Registry’s previous reporting. The agreed-upon price was about $892 million, or the equivalent to $980 per square foot, but PG&E noted in a filing with the Securities and Exchange Commission that the final number was “subject to certain adjustments.” Earlier this year, the firm opted to move forward with the purchase of the tower.
The seller, San Francisco-based TMG Partners, acquired the property for $450 million in October 2020 and arranged the office deal with PG&E.
In February, TMG subdivided the 300 Lakeside property to create a separate legal parcel for the office tower, which PG&E began occupying last year. TMG will retain the other parcel, which includes a parking facility and a smaller commercial building, for potential future redevelopment.
When PG&E committed to its 35-year lease at 300 Lakeside, it marked the largest lease ever signed in Oakland or San Francisco, and the purchase of the headquarters building is expected to break real estate records, especially considering the aftermath of the pandemic. The complex deal was executed during an unforeseen and unprecedented economic interruption. TMG presented the building to PG&E as a relocation opportunity for their headquarters while bidding on the property in 2019. At that time, the property was owned by Swig Co. and Rockpoint Group.