CIM Switches Oakland Tower Plan from Office to Multifamily
A 450-foot high-rise in Downtown will now become a 596-unit apartment building.
With Downtown Oakland office vacancies topping 23.3% in Q3 2022, CIM Group has adjusted its plans for a 450-foot tower it already has approval to build at 325 22nd Street.
According to a report in the San Francisco Business Times, CIM has decided that instead of building an office campus known as 2 Kaiser Plaza on the site, a 569-unit residential tower to be known as Town Tower will rise on the site.
In 2018, CIM received approval to put up two office buildings on the 22nd St. site, a 670K SF, 250-foot tall and a 1.1M SF, 450-foot tower. The development also envisioned about 10K Sf of ground-floor retail and restaurants.
The overall vacancy rate in the East Bay Oakland office market was 17.3% at the close of the third quarter, an 80-bps increase from the prior quarter, but just 10 bps above the same period in 2021, according to Cushman & Wakefield’s Q3 office market report for the East Bay Oakland market.
The market recorded negative 269K SF of net absorption, the first quarter of negative net absorption this year, C&W said. The submarket of Emeryville recorded a spike in sublease space in the third quarter that drove overall vacancy to 22.1%, the highest level since the pandemic began.
Oakland’s struggling Downtown office market has seen several proposed office towers get postponed during the pandemic, including Telegraph Tower, TMG’s 875K SF project at 2201 Valley St. and Eastline, a 1.6M SF building planned by Lane Partners and SUDA at 2100 Telegraph Road.
The new tower, designed by Solomon Cordwell Buenz of Chicago, potentially could be Oakland’s tallest building—if the Los Angeles-based developer gets it finished quickly.
In September, Houston-based Hines announced it is planning to build a 39-story office tower in Oakland, which would become the tallest building in the East Bay if reaches the finish line first.
The Hines development at 415 East 20th Street received approval from Oakland’s planning commission in May 2021. Hines filed demolition permits in August to clear a four-story building from the site.
The Houston develops plans call for a 622-foot tall building encompassing 850K SF, plus a garage with 262 parking spaces and 1,300K SF of ground-floor retail.
Offices in Downtown Oakland, including newer Class A buildings like Shorenstein Properties’ 600K SF tower at 601 City Center, has been half empty in recent months.