The University of California has opted to purchase two existing office buildings in the East Bay for nearly $80 million in order to cut long-term costs.

The space will be used to consolidate offices of UC Berkeley tenants, who currently lease space in various city locations.

The newly purchased properties are the 171,000-square-foot Golden Bear Center at 1995 University Avenue, purchased by the UC Regents for $53 million and a 70,000-square-foot building at 2850 Telegraph Avenue purchased for $25.5 million. The properties were acquired in late February and on April 1, respectively.

The Telegraph Avenue building will mainly house administrative offices of Boalt Hall School of Law, which are currently dispersed through Downtown Berkeley, said Christine Shaff, communications manager for facility services.

Michael Caplan, economic development manager for the city, said he was concerned by the purchases, citing a potential loss in tax dollars as the university is not subject to local taxation.

While Caplan said the university will be a stable tenant for the buildings, he added that it was important to ensure leases would be available to local business tenants in Downtown Berkeley.

"From a policy point of view, it would be nice to have some office buildings to remain for local business and remain on the city's tax roll," Caplan said.

Still, campus spokesperson Dan Mogulof said he expects the university's impact on the city taxes to be negligible.

"The university tenants will vacate their current leased spaces which then makes those previously occupied spaces available for taxable tenants," he said.

Despite the costs of the new acquisitions, Shaff said the university will save roughly 60 percent by avoiding the construction of new buildings.

She added the recent economic downturn has allowed the purchase of the office buildings at historically low prices.

UC Berkeley already leases about 350,000 square feet of office space near campus, so consolidating this space was a logical business move, according to Mogulof.

"It's really a matter of prudent use of resources and taking steps that will save money in the long term," said Mogulof.

Tags: OFFICE SPACE, DOWNTOWN BERKELEY