Huge East Bay Federal Building to Go on Selling Block
The Bay Area is back on the list of locations where the U.S. General Services Administration (GSA) is planning to offload major federal office buildings.
The GSA’s original list of office properties on the chopping block across the nation, released in early March, numbered in the hundreds and included two of the most prominent federal office buildings in San Francisco, the Speaker Nancy Pelosi Building and 50 United Nations Plaza.
That list of what the GSA called “non-core assets” was taken down just a few hours after it was posted and eventually replaced a month later with a list of just eight properties, none of which were in California.
This week, the agency added another eight properties to the culling list, including the 580,000-square-foot Frank Hagel Federal Building at 1221 Nevin Avenue in Richmond, the San Francisco Business Times reported.
The massive Hagel building currently is home to tenants including the Social Security Administration, Sun-Pacific Federal Credit Union and AFGE.
“The (GSA) is taking action to rightsize the federal real estate portfolio, cut costs for American taxpayers and optimize the space agencies need to achieve their missions,” a GSA spokesperson said, in a statement. “This initiative aims to engage the market, attract interested parties and inform strategies that will expedite the disposition of federal assets, consistent with all applicable laws.”
The Frank Hagel Building encompasses more than three-quarters of Richmond’s entire 668K-square-foot office market, which notched a vacancy rate of close to 15% in the fourth quarter of 2024, according to CBRE data.
The timing of when the Hagel building will hit the market and what its asking price might be were not disclosed. The price the huge building might fetch also is not clear in the Richmond market, which according to the Business Times, has not seen the sale of a prominent office property in several years.
However, several East Bay office properties in nearby communities have traded at significant discounts. Last week, a 109K-square-foot office building a few miles down the road from Richmond in Emeryville traded at close to a 70% discount via a deed in lieu of foreclosure.
San Francisco-based Blox Ventures took over the building at 6001 Shellmound Street within the Emeryville Public Market. In December, Blox acquired a $22M loan backed by the property from PNC Bank for $6.8M, or about $62 per square foot. Blox said the eight-story building at 6001 Shellmound is more than 60% occupied.
Earlier this year, in Lake Merritt, an Oakland suburb, Lakeside Venture bought the debt secured by 180 Grand, a 276K-square-foot office property, for about $108 per square foot before acquiring it through a deed in lieu of foreclosure.
Source: GlobeSt/ALM