OAKLAND — The Clorox Building in downtown Oakland was foreclosed due to a failed loan, a grim new indicator that the Bay Area office market remains in a weak position.
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At 1221 Broadway and part of the City Center mixed-use complex, the landmark tower was taken back through a speedy foreclosure process, documents filed on June 16 with the Alameda County Recorder’s Office show.
An alliance of private equity firm KKR and real estate company TMG Partners returned the Clorox Building to lender Heitman Capital Management, county documents show.
The Heitman Capital affiliate placed a value of $258.3 million on the building, which totals about 535,000 square feet, through the foreclosure.
An affiliate of KKR and TMG bought the Clorox Building for $253.5 million in 2018, Alameda County documents show. KKR obtained a $239.6 million loan from Heitman Capital at the time of the purchase.
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At the time of the transaction, commercial real estate experts described the purchase as the largest single-asset purchase in Oakland’s history.
In 2015, the Clorox Building was bought for $165.4 million, according to Alameda County property documents.
Oakland-based Clorox has its world headquarters in the building and is the anchor tenant. In 2012, Clorox sold the building for $110 million. The tower’s other tenants include Brown & Towland.
The deed in lieu of foreclosure for the Clorox Building represents one of the latest examples of the brutal economic conditions for the office market in Oakland as loan failures and fading values have begun to affect a growing number of office buildings.
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