The sale price translates to $186 per rentable sf and, based on 2001 income, a 9.7% capitalization rate. There were 12 offers on the property, says Vincent Schwab, the Marcus & Millichap broker who worked both sides of the deal with fellow M&M broker Scott Raymond.
Schwab told GlobeSt.com the selling partnership was a 52-member, 27-year-old group that was breaking up due to retirements and relocations. Compass Grand, he says, was impressed with the stability of the medical office market compared with the general office market in the Bay Area, which is weak right now.
The property is located at 3300 Webster in Oakland, includes and attached, 500-slip parking garage and is one of only three class A buildings in the area. It is directly across the street from Summit Medical Center in the heart of Oakland's Pill Hill area and is surrounded by Kaiser Hospital as well as more than 600,000 sf of office medical buildings.
The 25-year-old building originally went on the market in late 2000, but was affected by the recession and the resulting impact on the area's office rental market, which foiled deals with two previous prospective buyers. Schwab reintroduced the property to the market in August 2001 with a comprehensive campaign focusing on the stability of the area's medical office sector, one of the few sectors where supply has failed to meet demand.
Within five weeks of placing the property in the firm's national network, 12 offers were procured with buyers then submitting best and final offers with evidence of funds. Compass was ultimately awarded the asset after the selection and interview of five finalists.
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