Oakland office building is foreclosed in fresh sign of market maladies

OAKLAND — An office building that once was the Oakland Masonic Center has been taken back by its lender through a speedy foreclosure process that serves as a reminder of lingering weakness in the Bay Area office market.

The building, located at 3901 and 3903 Broadway in Oakland, is now owned by an affiliate of MidCap Financial, which provided the property with a loan in 2022 totaling $35.2 million, Alameda County real estate records show.

MidCap Financial took ownership of the property through a streamlined process known as a deed in lieu of foreclosure, according to documents filed on Nov. 10 with the Alameda County Recorder’s Office.

At the time of the foreclosure, the unpaid debt on the site was $32.5 million, the county records show.

An alliance of Chicago-based Harrison Street Real Estate and Walnut Creek-based Meridian had bought the former Oakland Masonic Building in 2022, paying $13.5 million for the site.

The building totals 61,300 square feet, according to marketing materials for the property.

A growing number of commercial properties, including office buildings, hotels and residential towers in Oakland, Berkeley and Emeryville, are undergoing financial stress to one degree or another in a difficult real estate market.

In some instances, the properties have suffered loan defaults that have led to foreclosures. In other instances, the commercial real estate sites have suffered a steep decline in value.

The Harrison Street and Meridian alliance had bought the Masonic Center with an eye to converting the property to medical offices, an effort that appears to have borne some fruit before the foreclosure.

The building is now known as Broadway Medical Plaza. A Pace Center for Elders’ Independence is an occupant in at least part of the building, according to Google Maps and the organization’s website.