OAKLAND \u2014 A landmark Oakland office tower is now owned by a veteran real estate firm after a speedy foreclosure that suggests the regional office market remains weak in the East Bay.<\/p>\n
601 City Center has been bought by an affiliate of Kennedy Wilson, according to documents filed on April 1 with the Alameda County Recorder\u2019s Office. The seller was a Shorenstein Properties affiliate, a grant deed shows.<\/p>\n
The 23-story, 600,000-square-foot office tower at 601 12th St.<\/a> is one\u00a0of the icons of the downtown Oakland skyline and is part of the City Center complex, a hub of offices, shops and restaurants in the East Bay city\u2019s urban core.<\/p>\n Kennedy Wilson, prior to taking ownership of the 601 City Center office building, purchased the loan that had financed the tower property. The deed stated that the Kennedy Wilson affiliate was both the buyer and the foreclosing lender in the deal.<\/p>\n In 2017, the 601 City Center building was part of a major success story for downtown Oakland<\/a> after the tower landed the headquarters of Blue Shield, which agreed to shift 1,200 workers to the East Bay city as part of an exit from San Francisco.<\/p>\n At the time of this week\u2019s deal to buy 601 City Center, the office tower was weighed down by $265 million in mortgage debt, this news organization\u2019s review of property documents shows.<\/p>\n Kennedy Wilson\u2019s affiliate assumed just $63.8 million of that overall debt through the purchase \u2014 a mere 24% of the total financing burden on the office tower.<\/p>\n It also appears the deal may help prolong the nosedive in the value of office buildings, hotels and apartment complexes in Oakland and elsewhere in the East Bay.<\/p>\n Why? As of January 2025, the 601 City Center property had an assessed value of $275.6 million, Alameda County real estate records show.<\/p>\n This means the debt total of $63.8 million that Kennedy Wilson\u2019s affiliate assumed through the deal was 76.9% below the assessed value.<\/p>\n A decline in an office tower\u2019s value bears ramifications that go far beyond the effect on the buyer or seller in a transaction.<\/p>\n The protracted slump in Bay Area commercial real estate values might hamper the delivery of public services.<\/p>\n The nosedive in the 601 City Center\u2019s value hints that the property might suffer a decline in its assessed valuation. The plunge also has implications for local government agencies and the services they provide.<\/p>\n If real estate values falter in a community, the decline could imperil a crucial revenue stream from property taxes for cities, counties, regional agencies and school districts.<\/p>\n The 601 City Center building\u2019s purchase represents the latest in a string of loan failures for high-profile buildings in downtown Oakland.<\/p>\n The real estate setbacks include the 500-room Oakland City Center Marriott Hotel<\/a>, multiple apartment complexes, and the historic Tribune Tower<\/a> office building.<\/p>\n","protected":false},"excerpt":{"rendered":"OAKLAND \u2014 A landmark Oakland office tower is now owned by a veteran real estate firm after a…\n","protected":false},"author":2,"featured_media":249054,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34],"tags":[389,184,387,7,8,3010,1335,8520,332,383,1533,181,100,143,145,144,388],"class_list":["post-249053","post","type-post","status-publish","format-standard","has-post-thumbnail","category-oakland","tag-alameda-county","tag-bay-area","tag-business","tag-california","tag-california-news","tag-commercial-real-estate","tag-development","tag-downtown-oakland","tag-east-bay","tag-economy","tag-keywee","tag-latest-headlines","tag-news","tag-oakland","tag-oakland-headlines","tag-oakland-news","tag-real-estate"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/249053","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=249053"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/249053\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/249054"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=249053"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=249053"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=249053"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}