A Los Angeles developer has switched plans for a 46-story office tower to a nearly 600-unit residential highrise in Downtown Oakland.
CIM Group has filed an early application to build the 596-unit apartment building at 325 22nd Street, the San Francisco Business Times reported.
That new housing proposal, dubbed Town Tower, would replace a highrise office project the developer entitled in early 2018. It includes 9,400 square feet of ground-floor shops and restaurants.
The 450-foot tower, designed by Solomn Cordwell Buenz of Chicago, would be Oakland’s tallest building. But it could be eclipsed by a 622-foot office tower planned by Houston-based Hines.
CIM received approval to construct what was formerly known as 2 Kaiser Plaza with two building options: a 670,000-square-foot, 250-foot tall office tower, or a 1.13 million-square-foot, 450-foot tall tower. Both plans, according to city staff, were “very similar” in their design and use.
Four years ago, office vacancy in Downtown Oakland was 3.1 percent, with spaces larger than 50,000 square feet rare.
Downtown office vacancy hit 33.1 percent in the third quarter, according to Cushman & Wakefield, up from 31.9 percent last summer, when the Class A building segment had a 37 percent vacancy
CIM’s pivot to residential suggests the developer believes a housing project would have a better future in the market.
Growth in Oakland’s moribund office market has stalled. Major highrise office projects proposed between 2016 and 2019 have yet to break ground.
They include Telegraph Tower, TMG’s 875,000-square-foot project at 2201 Valley Street; Oakland Tower, Hine’s 38-story, 862,000-square-foot tower at 415 Thomas L. Berkley Way; and Eastline, a 1.6 million-square-foot project by Lane Partners and SUDA LLC at 2100 Telegraph Avenue.
Other projects, upon completion, have failed to draw office tenants.
In 2019, Shorenstein Properties built a 600,000-square-foot highrise 601 City Center, Oakland’s first new ground-up office tower in a decade. The building, which has one of the few large blocks of Class A office space in the city, is half empty.
CIM Group, a major developer in Los Angeles, has taken heat for redeveloping much of the inner city West Adams neighborhood, leading to gentrification.
— Dana Bartholomew
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