News
HIKE, SET, GOAL!
January 4, 2012
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| Geeks and jocks may not mix on the university quad, but it’s a different story in the tech-rich SOMA District. That’s where Kilroy Realty Corp closed the purchase of 370 Third St and signed an 11-year lease with Pac-12 Enterprises for its HQ. Formed last year, Pac-12 Enterprises is the integrated content and media company of the Pac-12 Conference (celebrating the big Oregon Rose Bowl victory). Allen Matkins partner/real estate chair Tony Natsis (whom we snapped a while back with Regent Properties’ Jeff Dinkin) and senior counsel Andy Ouvrier provided legal representation to the landlord, Kilroy Realty Corp. Tony tells us Pac-12 Enterprises will occupy well in excess of 70k SF on the second and third floors. The space will include a state-of-the-art studio that will broadcast all Pac-12 sporting events—some of which will be on Fox and ESPN, some on cable and satellite stations. |
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| Kilroy went into escrow on the building in October and struck the Pac-12 deal the Friday before Thanksgiving. Kilroy’s purchase of the building made the Pac-12 lease effective. Tony says Pac-12 was in a huge hurry to get to the end zone. Unlike tenants who have the option to stay where they are, the new company had no existing HQ. “Their initial location in the world is going to be our building.” The building sale needed to close sooner than Kilroy had planned so there would be no impediment to Pac-12 starting construction of its broadcast facilities, in order to fulfill its contractual obligations with the various networks to produce sports programming. Without the lease, Tony says Kilroy wouldn’t have closed until January. “We had to speed up that entire process.” (In football they call that rushing.) |
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| There were more moving parts than a marching band: six different parties were involved, Tony says, including two ground lessors (a Brookfield entity and Pacific Bell, the building’s previous occupant). Three sets of brokers worked on the deals. On the lease, a team from Cushman & Wakefield repped Pac-12, while CAC’s Bill Cumbelich repped Kilroy. On the building sale, Eastdil Secured’s Jeff Weber and Stephen Van Dusen repped sellers Cerberus Institutional Real Estate Partners and Lincoln Properties. Pac-12’s legal team included Seyfarth Shaw’s David Roseman and Mark Mengelberg. During the negotiations, Tony says all that anybody could talk about was their favorite football teams. “We had guys from Berkeley, guys from Oregon.” Tony, a Michigan fan, must be pretty pleased with the Wolverines’ overtime win in yesterday’s Sugar Bowl. |
