Roger Fields’ Peninsula Land Nabs Walnut Creek Offices

Peninsula Land & Capital, the first office investor to buy low in San Francisco after the pandemic, has bought a 210,000-square-foot office building in Walnut Creek for $22.5 million.

The Palo Alto-based investor led by Roger Fields purchased PMI Plaza, a seven-story building at 3003 Oak Road, the San Francisco Business Times reported. The sellers were San Francisco-based Ridge Capital Investors and Westbrook Partners, based in Florida.

The deal worked out to $107 per square foot. Broker Chris Banke of Eastdil Secured handled the sale.

Ridge Capital and Westbrook bought the Class A offices in 2017 for $66 million, or $314 per square foot.

That means Peninsula snagged the property for a third less than it traded for eight years ago, made possible by a short sale — with the lender allowing the buyer to pay less than what was owed on the mortgage to avoid foreclosure, an unidentified source told the Business Times.

The deal required a three-way transaction involving Peninsula Land, the seller and the lender, Wells Fargo, according to Fields. It’s not clear what the bank lost on the sale.

Institutional money is staying clear of offices for now, creating opportunities for investors such as Peninsula Land to scoop up properties at a discount, according to Trent Barmby, senior managing director at JLL.

“I think it’s on one hand a pretty gloomy point in time … when you see these low prices — but on the flip side of it, these new buyers are going to hit a home run,” Barmby told the Business Times.

It was Fields that was the first to wade into the office market wreckage in San Francisco in the immediate aftermath of the pandemic.

In fall 2023, his Peninsula Land snapped up a 13-story, 355,000-square-foot office building at 550 California Street in the Financial District, for $40.5 million, or $114 per square foot.

That allowed Fields enough flexibility to offer competitive rents, shorter lease terms and capital improvements with the addition of a gym, ground-floor shops and a revamped lobby.

Fields said he plans to do something similar at his 23-year-old offices in Walnut Creek, operating the property as a long-term investment with rents set at “competitive” rates. At the time of sale, the building was just over half full with 90,000 square feet available for lease.

Office office vacancy in downtown Walnut Creek was 24.5 percent in the first quarter, according to CBRE. Ygnacio Valley, just east of 3003 Oak, had a vacancy of 14.8 percent.— Dana Bartholomew