55 Hawthorne in San Francisco Could Fetch Between $120MM and $125MM

San Francisco, Invesco Real Estate, Emeryville, Harvest Properties, JLL, Bay Area

San Francisco, Invesco Real Estate, Emeryville, Harvest Properties, JLL, Bay Area

By Jon Peterson

The planned sale of the 143,000 square foot office building located at 55 Hawthorne in San Francisco could attract a purchase price in the range of $120 to $125 million, according to sources familiar with the transaction.

The seller of the property is a partnership between local and national players. The main capital source for the property is Atlanta-based Invesco Real Estate. The local operating partner on this asset is Emeryville-based Harvest Properties. The sale of the asset is being planned through the San Francisco Bay Area Capital Markets team of JLL. This company declined to comment when contacted for this story.

According to offering documents from JLL, $26.2 million has been invested in the property since 2014, nearly half of which came from Yelp, the online and mobile rating company that has offices in the building.

The sellers have a somewhat unconventional offer for the potential buyers. There will be two different prices offered on a square foot basis on the property, which is primarily driven by a five-level 348-space parking garage affiliated with the property. The price per foot on the entire property is around $850 per square foot. However, the price for just the office building is in the range of $700 to $725 per square foot.

This pricing will be much higher than what the current owners had paid for the property when they purchased it in July of 2014,which was around $550 per square foot, according to sources that track the sale of office buildings in San Francisco.

The renovations that Invesco/Harvest had planned for the project have now been completed. This is reflected in the fact that the eleven-story property is now 100 percent occupied. The property was originally build in 1970.

The San Francisco office market is now going through a period of increased interest, and as a result many significant office assets are being placed on the market for sale. Another asset that could be sold in the future is 600 California Street, which is owned by Bentall Kennedy. The company acquired the asset in November of 2014 for $216.5 million or $603 per square foot.

Other assets on the market are 655 Montgomery, 100 Pine and 150 Spear.

Office assets in San Francisco are sold on the average around $750 per square foot, as stated by sources that follow the sale of office buildings in San Francisco. That figure, however, can vary significantly depending on the asset, the tenants as well as the location itself.

West Coast Commercial Real Estate News