WeWork leases up space for second Oakland outpost

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October 23, 2018
San Francisco Business Times
WeWork leases up space for second Oakland outpost

WeWork’s rapid Bay Area expansion continues with another outpost coming to Oakland.

The co-working operator leased 68,000 square feet on three floors in TMG Partners’ 2201 Broadway to house about 1,100 desks opening next spring. The deal is one of the largest office leases in Oakland this year as the city’s office market tightens.

“With large floor plates and high ceilings, the property is ideally suited for creative, technology and other startup tenants – not to mention our location within two blocks of BART, Lake Merritt and a myriad of restaurants and entertainment venues,” said David Cropper, TMG Partners director of development, in a statement.

WeWork has been adding new Bay Area locations at a steady clip in recent years. The company, which rents desks and private offices by the month, recently inked a deal for its 15th location in San Francisco, at 1 Post St., and is now up to 23 locations in the region including 2201 Broadway.

"Our existing locations in Oakland and Berkeley are not only fully occupied, but have waiting lists of companies hoping for more space," said Elton Kwok, WeWork's general manager for Northern California, in a statement.

The first Oakland WeWork opened last year in 1111 Broadway in the city’s downtown office district and above a BART station. That space, encompassing 80,000 square feet, has capacity for more than 1,400 people in a variety of desks, booths, tables and 287 private offices.

The 2201 Broadway outpost will be WeWork’s fourth in the East Bay as it also expands in Emeryville and Berkeley. WeWork plans to open another space this spring in 1900 Powell St. in Emeryville, where it leased 38,000 square feet. WeWork is adding a second location in Berkeley that will open in fall of 2019 at 2120 Berkeley Way, a 42,500-square-foot building developed by Rhoades Planning Group. The company already operates in 2120 University Way in Berkeley.

The company has been expanding into other suburban areas such as Mill Valley and San Mateo with plans for even more locations coming soon.

TMG Partners bought the 198,000 square-foot 2201 Broadway in 2016 for $65 million, or about $328 per square foot and began a $14 million revamp of the former furniture-store-turned-office building.

Built in 1931, the Art Deco-inspired building dons a distinctive terra cotta exterior. It housed Breuner's Home Furnishings with a showroom on the first floor.

TMG hired Studio O+A to design the renovation, which involves reconfiguring the first floor including creating new lobby and relocating the entrance to Broadway from of a side street.

The building sits in the heart of Uptown, a thriving neighborhood that has been in the middle of a revival during the past decade with dozens of new shops, restaurants and performance venues opening up. Now, developers are working to add more than 1,000 new homes in the surrounding blocks.

2201 Broadway is a few blocks from the 19th Street BART Station and major freeway connections. Proximity to transportation is a key draw for many office tenants leasing up space in Oakland, Cropper told the Business Times last year.

TMG Partners is one of several investors that have jumped into Oakland for the first time in the past five years. The San Francisco-based firm bought its first Oakland building, 1330 Broadway in 2015 for $80 million and sold it earlier this year for $173 million.

The developer is also working on a plan to add another office tower on an adjacent parking lot to 2201 Broadway.

Brokers John Dolby and Dane Hooks of Cushman and Wakefield represented the landlord in the WeWork lease. Savills Studley’s Steve Barker represented WeWork.

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