Forget the DOGE cutbacks in federal real estate. The VA has signed the largest office lease in Oakland in four years.
The U.S. Department of Veterans Affairs leased 57,000 square feet at the long-vacant 21-story tower at 1950 Franklin Street in Uptown, the San Francisco Business Times reported.
Terms of the deal with landlord Behring Companies were not disclosed.
Danville-based Behring bought the 450,000-square-foot building and a 255,000-square-foot parking garage in September for $14.35 million, or $20 per square foot. The seller, Kaiser Permanente, said the building has been “nearly unoccupied” since 2020.
The VA is the building’s first large tenant in years. The federal agency previously leased offices at 2221 Martin Luther King Jr. Way in Uptown.
Behring is renovating the building, constructed in 1975 and revamped nine years later, according to Loopnet.
The makeover will include luxury, flexible offices, from co-working space to private workplaces. The cost and timeline of the renovation were not disclosed.
The cosmetic rework is part of the firm’s aim to create a mixed-use urban campus in the East Bay city. Behring recently completed 1900 Broadway, a 39-story ultra-luxury apartment tower of “tech-enhanced” apartments, with a Tesla fleet available for daily rental, atop the 19th Street BART station, the outlet said. A contractor has sued the developer for $20 million over construction delays.
The office market across Oakland is still struggling to climb out of the pandemic, with office vacancy in the central business district at 34.5 percent last month, according to CBRE.
The VA lease is 3.5 times bigger than the second-largest lease signed in Oakland in the first quarter, 16,000 square feet from law firm Goldfarb & Lipman at 1330 Clay Street.
The last large lease in Oakland was Twitter’s infamous deal in 2021 to rent 66,000 square feet at 1330 Broadway. The following summer the social media firm now known as X said it would not move in.
President Donald Trump’s administration has been shedding federal real estate.
In February, the Department of Government Efficiency led by billionaire Elon Musk expected to offload more than 2 million square feet of federal offices, cutting Uncle Sam’s rent bill by at least $144 million, according to an analysis by The Real Deal.
Early last month, the DOGE list included two federal buildings targeted for sale in San Francisco. The next day, however, the buildings in SoMa and the Civic Center vanished from the online roster.
Read more
