California selling state buildings
By Judy Lin
SACRAMENTO, Calif. — California has put the "for sale" sign on 11 state office buildings, including the San Francisco Civic Center and the Ronald Reagan State Building in Los Angeles, as a way to raise cash to shrink the budget deficit.
Los Angeles-based real estate firm CB Richard Ellis released a sales brochure yesterday as part of its marketing strategy to lure potential buyers. Combined, the buildings have more than 7 million square feet of office space.
State officials are hoping to draw offers worth more than $2 billion. Potential buyers have until April 14 to make offers.
California and other state and local governments have been eyeing their high-rises, prisons and even capitol buildings to generate fast cash for fiscal relief.
CB Richard Ellis Vice Chairman Kevin Shannon said the sale is a low-risk investment for potential buyers worldwide. Since the state is planning to lease the space back, it gives the new owners a steady stream of income.
The sale was adopted as part of last year's budget agreement between Gov. Arnold Schwarzenegger and lawmakers to raise money for the state. California is facing a $20 billion shortfall through the middle of next year.
The state plans to use proceeds of the sale to pay off more than $1 billion in bond debt that was taken out to construct the buildings. The state estimates it will net $660 million and put that into the general treasury.