The new Oakland headquarters will be a more efficient use of space for PG&E's workforce and provide greater flexibility for layout and density to both promote workplace health and safety, and accommodate potential new working arrangements in a post-COVID-19 environment. In addition, commutes should be easier for the majority of headquarters employees who already live in the East Bay.

"Oakland is the perfect fit for us for a host of reasons. It is a thriving hub of industry and innovation in our state, and we look forward to establishing our headquarters and contributing to life there," said Andy Vesey, utility CEO and president. "We are also proud of our history in San Francisco, where PG&E has been headquartered for 115 years, and we will continue to serve our customers in this great city. We expect the sale of our San Francisco headquarters will unlock value in a notoriously tight real estate market, no doubt bringing a dynamic new tenant to downtown."

PG&E expects to remain in its current location, which includes 77 Beale St. and 245 Market St., until the move is complete in 2023. PG&E also plans to consolidate two other East Bay satellite office locations, 3401 Crow Canyon Rd. in San Ramon and 1850 Gateway Blvd. in Concord, into the new Oakland headquarters beginning in 2025. This overall plan will simplify PG&E's Bay Area real estate footprint and lower its operating costs.

Subject to Bankruptcy Court approval and the satisfaction of certain conditions, PG&E will enter into a lease with purchase option for the Oakland property with developer TMG Partners. At the developer's own upfront cost, TMG will renovate the Oakland property to PG&E's specifications before operations are relocated. The upgrades will include the entire process of design, engineering and, with the general contractor, constructing new workspace compliant with PG&E standards. PG&E anticipates that the renovation and relocation of operations from the San Francisco headquarters complex will be completed in 2023.

The long-term lease includes a purchase option for PG&E to acquire the property from TMG Partners in 2023. The transaction is approved by TMG Partners and PG&E, and is subject to final approval by the Bankruptcy Court.

"We are pleased to assist PG&E as it emerges post-bankruptcy, and seeks cost and operational efficiencies," said Matt Field, president of TMG Partners. "We recognized that 300 Lakeside could provide a transitional opportunity where the company is able to optimize its footprint, phase into the new space in a compact timeline in a location that is easily accessible to a majority of their employees–and understanding Oakland's continued regional desirability for its central location, transit access and great community. We worked together to structure the transaction to have a comfortable timeline to renovate the property for PG&E's workspace and provide the flexibility for the company to elect whether to own or lease their completed headquarters."

The 300 Lakeside property, a signature building on Oakland's skyline, was originally developed as the headquarters for Kaiser Industries in 1960 and was designed by architecture firm Welton Beckett Associates. The property includes a 1,339-stall parking garage with a rooftop landscaped open space and approximately 130,000 square feet of retail and office space in a two-story building at 344 Thomas L. Berkeley Way. The building also has a conference center with 393-seat auditorium and pre-function area which is used for both tenant functions and third parties.

TMG Partners will retain ownership of the garage and Thomas L. Berkeley Way building. TMG recently completed major renovations to the building including elevator modernization, new common areas, conference center, bike room, tenant lockers and showers, café, and food truck zone.

"The transaction also demonstrates the benefits to the greater Bay Area region," said Michael Covarrubias, TMG Partners chairman and CEO. "Oakland gains a new company with PG&E occupying a former corporate headquarters building, built for Kaiser in the 1960s, and the investment will add significant annual property, payroll and other tax revenue for the city of Oakland. Concomitantly, when PG&E's current headquarters is ultimately sold and occupied by another company, the city of San Francisco will enjoy significant additional annual property tax and commercial rents tax revenue as PG&E has been an owner-occupant of the property since the construction of the buildings 50 and 115 years ago respectively. We anticipate that San Francisco will also receive other increases in tax revenues from the sale and re-tenanting of the property."

PG&E expects to launch a competitive market process to sell the company's San Francisco headquarters office complex. The sale is expected to occur after the company emerges from Chapter 11.