441,000-square-foot office complex is newest addition to Manulife’s global real estate portfolio and Company’s second major real estate acquisition in the Bay Area in the past year
San Francisco - Manulife Real Estate, the real estate arm of Manulife Financial Corporation, has purchased Hawthorne Plaza, a 441,000-square-foot office complex in downtown San Francisco, from a joint venture of Hines and RREEF in a deal that closed July 29, 2011. The acquisition marks Manulife’s second real estate investment in the Bay Area in less than a year. Manulife acquired Market Centre, a 770,000- square-foot San Francisco office complex in September 2010.
“We are truly delighted to add a property as significant as Hawthorne Plaza to Manulife’s global real estate investment portfolio,” said Kevin Adolphe, Chief Operating Officer of Manulife Financial’s Investment Division and President and CEO of Manulife Real Estate. “San Francisco is one of the target growth areas for our Company’s real estate business. The acquisition of Hawthorne Plaza is the latest step in our ongoing strategy to invest in core office properties to complement our growing portfolio across the United States, Canada and Asia.”
Hawthorne Plaza boasts a strong, stable tenant roster anchored by the Environmental Protection Agency (EPA), which occupies approximately 285,000 square feet for its Southwest Regional Headquarters. In June of 2011, the EPA renewed its lease at Hawthorne Plaza for an additional 15-year term, reinforcing the property’s status as a key business location in San Francisco’s South Financial District.
In May of 2009, under Hines management, Hawthorne Plaza earned the distinction of being the first multi-tenant office building in San Francisco to achieve LEED-EB Gold Certification. There have also been significant capital improvements made to the complex over the past several years. As part of the EPA lease renewal, the property is targeted to undergo significant renovations, new tenant improvements and a retrofit of key building systems, with an aim to pursue LEED-EB Platinum status.
“Hawthorne Plaza is an exceptional property and one that we are extremely proud to add to Manulife’s global real estate portfolio,” said Thomas Patton, Managing Director of Manulife Real Estate’s portfolio in the western United States. “This prominent complex boasts a strong tenant base, highlighted by the EPA, which has recently reaffirmed its commitment to the building. Together with the ambitious renovation program we have planned, we believe we have an opportunity to set a whole new standard for office properties in San Francisco.”
Hines and RREEF acquired Hawthorne Plaza in 2007. Since that time, Hines has achieved significant leasing success and sustainability upgrades. Hines, which developed the original renovation plans for the complex, will continue to manage the property and oversee the EPA retrofit project on behalf of Manulife Real Estate. Hines is a privately owned real estate firm involved in real estate investment, development and property management worldwide. In San Francisco, Hines owns and manages approximately four million square feet of properties.
Hawthorne Plaza is a Class-A office complex consisting of two buildings: 75 Hawthorne Street, a 20-story, 342,000-square-foot building built in 1987 and 95 Hawthorne Street, the original five-story, 99,000-square-foot building constructed in 1910 and extensively renovated in 1991.
In addition to its panoramic views of the City, Bay and Twin Peaks, Hawthorne Plaza offers tenants and visitors convenient access to all modes of transportation and major access routes connecting San Francisco and the Greater Bay Area. The four-block area surrounding the property also continues to experience a surge of investment and development activity, with billions of dollars committed to a number of high profile projects.
Manulife Real Estate has a longstanding presence in the California real estate market, reaching back to the early 1970s. Today, the Company’s California real estate portfolio consists of 20 office and industrial properties covering more than five million square feet and having a market value of approximately US$1 billion.
About Manulife Real Estate
Manulife Real EstateTM, the real estate arm of Manulife Financial Corporation, is actively involved in the ownership, development and management of commercial real estate. The portfolio includes a diversified mix of prime office and industrial properties in key metropolitan centers throughout Canada, the United States and Asia. In addition to equity real estate, Manulife Real Estate manages the Company’s space requirements and own-use facilities to accommodate Manulife’s more than 24,000 employees worldwide. As at March 31, 2011, Manulife’s global real estate portfolio totals 30 million square feet and represents a carrying value of Cdn$6.3 billion (US$6.4 billion).
About Manulife Financial
Manulife Financial is a leading Canadian-based financial services group operating in 22 countries and territories worldwide. For more than 120 years, clients worldwide have looked to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients around the world. We provide asset management services to institutional customers worldwide as well as reinsurance solutions, specializing in life and property and casualty retrocession. Funds under management by Manulife Financial and its subsidiaries were C$478 billion (US$492 billion) as at March 31, 2011. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.
Manulife Real Estate has purchased Hawthorne Plaza, a 441,000-square-foot office complex in downtown San Francisco in a deal that closed July 29, 2011. The newest addition to Manulife’s global real estate portfolio marks the Company’s second real estate investment in the Bay Area in less than a year.