San Francisco Civic Center | Institutional Group Institutional
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Capital Markets SAN FRANCISCO CIVIC CENTER | Institutional Group 350 MCALLISTER STREET AND 455 GOLDEN GATE AVENUE SaN FRANCISCO, CA 94102 GOLDEN STATE PORTFOLIO OFFERING MEMORANDUM 11 office properties • 7.3 million square feet 20 year sale/leaseback portfolio 3 California core metro markets SAN FRANCISCO TABLE OF CONTENTS CIVIC CENTER Kevin Shannon 01 Executive Summary 05 State of California Overview Vice Chairman The Offering Economy 310-516-2480 Investment Highlights Tourism & Entertainment [email protected] Property Overview Geography Lic. 00836549 Location Overview 06 Lease Abstract Robert Gilley Recent Developments Executive Vice President The Opportunity 07 Financials 415-772-0187 LEED® Certified [email protected] Marketing Process Lic. 01084869 02 Property Summary Randy Getz General Property/Site Information Executive Vice President Construction Detail 916-446-8287 Interior Detail [email protected] Mechanical Detail Lic. 00828903 Site Plan Representative Floor Plans For debt financing 03 Area Overview information, contact: The San Francisco Bay Area Overview Ken White San Francisco Overview Senior Vice President 04 Market Analysis 310-516-2408 [email protected] San Francisco Office Market Lic. 01788506 CB Richard Ellis, Inc. Broker Lic. 00409987 For more information about the Golden State Portfolio, please visit the website: www.cbre.com/goldenstateportfolio 1 SAN FRANCISCO EXECUTIVE SUMMARY CIVIC CENTER The Offering Offering Summary CB Richard Ellis, as exclusive advisor to the State of The property is 100% leased, of which 99.8% is Property Name: San Francisco California, is privileged to present the opportunity leased to the State of California for a firm term Civic Center (Earl Warren Center/ to acquire a 100% fee simple interest in the San of 20 years, and may be acquired separately or Hiram Johnson Center) Francisco Civic Center, located at 350 McAllister as part of an 11 office property sale/leaseback Address: 350 McAllister Avenue Street and 455 Golden Gate Avenue in the Civic portfolio (the “Golden State Portfolio”) comprising 455 Golden Gate Avenue Center submarket of San Francisco, California (the approximately 7.3 million square feet located San Francisco, CA 94102 ® “Property”). The Property consists of a LEED Gold in the San Francisco Bay Area, Los Angeles Rentable Square Footage: ± 912,387 certified, Class A office property containing 912,387 and Sacramento. Number of Buildings: Two rentable square feet in two connected buildings, This rare opportunity to acquire an excellent and includes 65 parking spaces in a below grade Year Built: 350 McAllister: 1922 quality Class A office property provides an (Renovated 1999) garage. The 6-story 350 McAllister Street building, 455 Golden Gate: 1999 investor a stable, long-term income stream from which houses the California Supreme Court, was an investment grade tenant. Number of Stories: 6 & 14 stories originally constructed in 1922, and completely Parking: ± 65 stalls (0.07 per renovated in 1999 when the adjacent 14-story 1,000 sf) steel framed high-rise office building located at LEED Certification: LEED Gold 455 Golden Gate Avenue was constructed. (455 Golden Gate) State of California Lease Term: 20 years firm 3 Investment Highlights • Long Term Credit Tenancy • Critical Mass in Supply SAN The Property is 100% leased, of which 99.8% is Constrained Submarket FRANCISCO leased to the State of California for 20 years firm, The Property represents a critical mass of square CIVIC providing an investor with stable and secure footage unmatched in the submarket, where CENTER cash flows and built-in rent escalations that large users have few comparable options in the enhance yields during the lease term. The State entire San Francisco office market let alone the of California has an investment grade credit submarket. Additionally, no new office properties rating of “A-“ by Standard & Poors. The lease will larger than 100,000 sf have been constructed in commence at the close of escrow. the submarket in the last 20 years. • Exceptional San Francisco • Strategic Facility Civic Center Location The State of California’s commitment to the The Property is situated between McAllister Property is demonstrated by the 20 year initial and Golden Gate Avenues and across the street lease term. The State tenancy provides the from San Francisco City Hall, an irreplaceable investor a superb captive tenant story based location highly valued by government and on their utilization of the Property and the support service users. The Property enjoys State’s projected increased long term space excellent access to public transportation via needs. Additionally, the historical nature of the the Civic Center station 2 blocks away providing Property and the Supreme Court’s occupancy service throughout the city and region via the for nearly 90 years further demonstrates the SF Municipal Railway and the Bay Area Rapid State’s commitment to this Property. Transit (BART) system. • Top Property in Submarket The Property’s overall quality and finishes are unmatched in the submarket. The 350 McAllister building houses the California Supreme Court, with highly specialized interior build-outs including Justices’ Chambers. The recently constructed 455 Golden Gate building features an impressive 3-story lobby and a 5-story atrium with a glass skylight and a number of large art installations. There are two courtyards situated between the two buildings. SAN FRANCISCO CIVIC CENTER Property Overview The Property is a unique example of a historic the Attorney General and the Secretary of State. building merged with a modern building. The Earl The building was named after California Governor Warren Court Building (350 McAllister) was originally Hiram Johnson, who was later also a U.S. Senator. built in the 1920’s to house offices from all three Location Overview branches of State government. These included the statewide headquarters of the Supreme Court, as The Property is located within the Civic Center well as local offices of legislators and an office for submarket of San Francisco, the political center of the Governor. the City and the Bay Area. The City of San Francisco has invested heavily in the area over recent years In 1995, the reconstruction of the entire block was including a new Symphony Hall, a renovated Opera begun. The historic side was completely gutted. House, a new Asian Arts Museum, a new Library A new foundation was tied to the building, and and a renovated City Hall. The private sector has it was strengthened seismically. All of the wood supplemented this with development of luxury was removed, stripped of hazardous finishes, housing, commercial space and amenities. San and re-assembled in the reconstructed building. Francisco enjoys excellent transportation options The reconstruction restored the building to the and is accessible by all major forms of public original 1920’s look, including a complete historic transportation - including light rail (BART and Muni), renovation of the Supreme Court courtroom. The ferry, and bus - serve San Francisco. San Francisco entire building was dedicated to use by the Judicial also has an international airport only minutes from Branch, and it now houses the main offices of the Civic Center submarket. The Property enjoys the Supreme Court and the First District Court of easy access to interstate freeways 80 and 280, US Appeal. The building was re-named in honor of Highway 101, and both the Golden Gate and the United States Supreme Court Chief Justice Earl Bay Bridges. Warren, who was also a Governor of California. The 1950’s seven-story building was razed. In its place, a completely new fourteen story office building was built. It now houses four main tenants: The statewide headquarters of the Administrative Office of the Courts, Judicial Council and the Department of Industrial Relations, as well as the local office of the Department of Justice. Other tenants include four members of the Legislature, and the San Francisco offices of the Governor, 5 Recent Developments The Opportunity LEED Certified The Civic Center submarket has seen little new The San Francisco Civic Center offer’s an investor The LEED® (Leadership in Energy and Environmental recent development and is generally full built- the rare opportunity to acquire an institutional Design) Green Building Rating System is the out. One notable exception is the SFPUC building quality office asset that is leased for 20 years to nationally accepted benchmark for the design, currently under construction at 525 Golden Gate an investment grade credit tenant – the State of construction, and operation of high performance Avenue. The project consists of a new 13-story California. The Property is home to the California green buildings. Developed by the U.S. Green office building that will house the San Francisco Supreme Court and it is the top office property in Building Council, LEED provides building owners Public Utilities Commission (SFPUC) administration the submarket. The combination of a long term and operators a concise framework for identifying offices and its criticalS upervisory Control and Data lease to a credit tenant, and rent escalations and implementing practical and measurable Acquisition system that monitors and controls during the term will provide healthy yields green building design, construction, operating and the SFPUC’s water transmission and distribution throughout the investment horizon. The Property’s maintenance solutions. system. With funding secured and necessary LEED