Office Space: Concord Office Project for Sale
East Bay Business Times, May 20, 2005
Commercial space
R&B cashes in on Concord Plaza
Katherine Conrad
Reynolds & Brown is sifting through a dozen or so bids from buyers interested in acquiring the Concord Airport Plaza, the company’s flagship property as well as its headquarters.
Interest is high, said BT Commercial Real Estate/NAI’s Michael Speers, the exclusive broker for the 354,000-square-foot Class A property built by Reynolds & Brown in 1984 and 1985.
“We have received a tremendous amount of interest due in part to the long-term tenancy of Wells Fargo Bank, who has occupied a majority of the project since 1985,” Speers says. “Wells Fargo occupies 93 percent of the buildings and they have options to remain going out 35 years.”
No asking price was set, but Mt. Diablo Plaza in Walnut Creek sold for more than $275 a square foot this month. Oakland office towers are commanding about $200 a square feet. Concord likely would be somewhere in the middle, probably toward the higher end.
The complex, with its fountain and courtyard, has been called a sleeper in the market because Reynolds & Brown, which has developed 8 million square feet during its 40 years in business, has owned the property since it was built and Wells Fargo almost immediately took the bulk of the space.
Why sell the six-story twin structures now? Mike Hurd, president of the development company, replies: “Generally we are not sellers. We build long-term equity in real estate and utilize that. But in every investment there reaches a point in time, where you look at the market and the value that can be created with the market forces at work.
“There are some pretty dynamic things going on that may or may not repeat themselves.”
Translation: Hurd has never seen so many office parks changing hands at such high prices. “It’s frothy,” he says.
Whether Reynolds & Brown stays on as a tenant remains to be seen.
Meanwhile, the company is breaking ground on its Antioch business park, whose residential component was the target of a successful citywide referendum last June.
