Creative Media Buys Four Oakland Properties from Parent CIM for $282M

Dallas-based REIT Creative Media & Community Trust (CMCT) has purchased a majority stake in four properties—two multifamily campuses and two development sites—in Oakland from its parent company, CIM, for $282M.

The acquisition of the multifamily properties marks a strategic shift for Creative Media, which holds 1.3M SF of offices in its portfolio, to more of a focus on multifamily.

CMCT has specialized in creative office properties, with assets located in Austin, San Francisco, Los Angeles and Oakland. The REIT also owns 696 multifamily units in Los Angeles and Oakland. CIM Group owns 42.3% pf CMCT.

The CIM affiliate bought an 89.4% stake in three properties in the city’s Jack London Square and a fourth property in Downtown, according to a report in the San Francisco Business Times.

The transaction included Channel House, a 333-unit apartment building at 40 Harrison Street, which CMCT acquired for $134.6M; Site F3, a vacant 2.3-acre site at 55 Harrison Street that has approval for a 144-room hotel, for $250,000 and Site D, a parking lot at 466 Water Street, approved for a 136-unit apartment campus, for $2.5M.

The REIT also bought a 98% stake in 1150 Clay Street, a 288-unit apartment building in Downtown, for $145.5 million. As part of the deal, Creative Media paid $3.4 million in transfer tax to the City of Oakland.

Creative Media and CIM Group are working together on Town Tower, a 550-unit apartment complex at 325 22nd Street in Oakland, first proposed as an office tower.

Creative Media’s largest property in Los Angeles is a 197K SF office building at 11620 Wilshire Boulevard that currently is 78% leased.

Earlier this month, CIM Group received an offer from tech entrepreneur Daniel Negari, who founded internet domain name XYZ.com, to buy CMCT for $8.88 per share last month, according to a regulatory filing on Monday. The offer is valued at about $201M.

The offer was rejected by Creative Media’s board, which called it “substantially undervalued” and noted that Negari had not secured financing for the deal, according to a report in TheRealDeal.

In its Q1 earnings statement, CMCT reported close to $1B in AUM.