Align Real Estate Puts San Francisco Asset on the Market with Pricing Guidance ~$190MM

San Francisco, Bay Area, Align Real Estate, Vanke, Livermore, Walnut Creek, San Ramon

By Jon Peterson

San Francisco-based Align Real Estate has placed on the market for sale the 155,000 square foot office building in San Francisco located at 657-667 Mission Street. The pricing guidance on the property is somewhere in the range of $190 million to $200 million, according to sources familiar with the sale of the property.

The seller of the property declined to comment when contacted for the property. The listing agent on the sale is the San Francisco office of Newmark Knight Frank. This company did not respond to several emails for a comment on the sale.

Align has owned the asset since March 2017 when the firm acquired the property for $64.6 million, according to industry sources and previous reporting by The Registry. Its equity partner on the transaction was Vanke US, the U.S. investment arm of China Vanke.

The seller and its partner had made the decision to sell the property since they have completed the business plan on the asset. Following the acquisition, the property was converted to creative office space and has been enlarged from 130,000 square feet in 2017 to its current size. The asset is now fully leased to Unity Technologies, a firm that makes software for video games. The company’s lease has a triple-net structure and has over 11 years left to run.

The property as it stands now is a core asset. It will represent one of a limited number of core office building assets that are on the market currently in San Francisco. The expectation is that the property will attract both domestic and foreign investment capital.

Align will be placing on the market soon another asset for sale in the Bay Area. These are three office buildings in Livermore located at 3011, 3055 and 3077 Comcast Place. Two of the buildings are leased and there is one property that is vacant. One of the occupied buildings is 3055 Comcast, which is used as the corporate headquarters for Comcast.

No pricing guidance was available at this time. Align has been the owner of three buildings with a different investment partner than the one with the San Francisco property. Current ownership had paid $59 million for the three buildings in June 2016, according to public documents.

It’s likely that two different types of buyers may emerge with interest in the three buildings. The leased buildings will most likely attract one type of an investor, while a different investor could acquire the empty building.

Align is still a long-term believer in the office market in the San Francisco Bay Area, according to sources familiar with the company’s activities. The company still holds ownership of properties that are located in Walnut Creek and San Ramon.

West Coast Commercial Real Estate News