The Oakland Port Commission approved the proposed sale last night of most of the buildings in Jack London Square to the San Francisco-based real estate investment company, Divco West. Under the deal, Ellis Partners, the private development firm that had been the majority owner of the buildings, will now own just a 1.5 percent stake, while Divco West will own 98.5 percent. Ellis Partners, however, will continue to run day-to-day operations at the square.
Ellis Partners reached the deal with Divco West after a request by its bank creditors to bring in more capital investment in the square. Ellis Partners had obtained about $130 million in mortgages on buildings in the square to renovate them, but has had trouble attracting tenants to help finance more planned construction. Questions also have surfaced over the years as to whether the Ellis Partners has managed the square well.
The commission voted 6-0 in favor of the deal, with Commissioner Victor Uno abstaining. Uno is an employee of the International Brotherhood of Electrical Workers Union, which has been an investor in the square. He routinely recuses himself from issues involving the square. The sale of the buildings required the commission’s approval because the structures are on land owned by the port. The port sold the buildings to Ellis Partners for a total of about $23 million in 2002 and 2005.Stuart Shiff. The company‘s holdings include properties and buildings throughout Northern California, and in Massachusetts and Texas.