Oakland Tribune Tower owner flips another historic office building
Tom Henderson, a businessman who is seeking to create 2,000 jobs in Oakland through a foreign investment program, has sold the historic I. Magnin Building, one of the four office buildings he bought in Oakland's downtown.
San Diego-based HP Investors has acquired the building at 2001 Broadway for an undisclosed price. The sale closed last Friday, according to public records.
Henderson bought the property for $9.8 million from Beacon Group Ventures in 2013. With Oakland office buildings selling for more than $300 per square foot in the past year, the 60,000-square-foot building could have traded for over $18 million, potentially doubling in value in three years.
Henderson previously told the Business Times that he bought the property primarily to house one of the call centers that he is operating through the EB-5 program, a controversial financing method that allows foreign investors to obtain green cards in exchange for investing at least $500,000 in the United States and creating 10 jobs.
Henderson said the building sale would have no effect on the planned opening of a call center in the ground floor and that employment levels were "growing quickly," with a few hundred total employees in the city.
"Tom will continue to maintain a presence," said Isaac Abid, a partner at HP Investors. "He views this as a way to strategically recapitalize funding for the call center."
Henderson is also facing two lawsuits from partners alleging financial misconduct. One filed by Allan Young, who worked with Henderson on the call centers, alleges that Henderson improperly diverted EB-5 funds to finance his building purchases. Henderson has said that funding came from bank loans.
Separately, a nonprofit claims that Henderson missed payments in the redevelopment of a stalled grocery store in West Oakland.
The I. Magnin Building is the fourth Oakland acquisition for San Diego-based HP Investors in the last year. The company now controls around 100,000 square feet in total, including a 9,000-square-foot ground floor retail space at 222 Broadway, 2131 Broadway and 2344 Harrison St.
"This is sort of the culmination of the work we've been doing," said Abid. "We think there's a good opportunity to capitalize on the building's charm and character."
HP Investors plans to spend hundreds of thousands of dollars in renovations on the elevator and lobby. It may also seek to add more entrances to the ground floor.
The building's only vacancy totals 11,200 square feet on the third floor, space formerly occupied by the online marketplace company Minted. Brokers Grant Jones, Jake Norton and Conor Famulener of CBRE are leasing the space.
Other tenants include Tierra Mia Coffee and George Zimmer's zTailors, an on-demand tailoring service.
Henderson still owns the landmark Tribune Tower at 401 13th St., the former Dufwin theater at 517 17th St. and the former Community Bank of the East Bay headquarters at 1740 Broadway.
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