By Jon Peterson
Washington, D.C.-based ASB Real Estate Investments is now marketing for sale the 140,410 square foot creative office/lab property located at 444 De Haro Street in San Francisco. The pricing guidance on the potential sale is somewhere in the range of $190 million to $200 million, according to sources familiar with the property.
ASB has selected the San Francisco office of Newmark to be the listing agent on the sale. Those working on the sale include Grant Lammersen, vice chairman, Steven Golubchik, head of NorCal Capital Markets, and Mark Geisreiter, executive managing director. Both ASB and Newmark declined to comment when contacted for this story.
ASB has been the owner of the property since 2014. The real estate manager had acquired the asset for $92.6 million at that time, according to public records. The capital source used on this acquisition was the ASB Allegiance Real Estate Fund. ASB had invested an additional $6 million of capital for improvements it has made to the property.
The offering for 444 De Haro also includes the adjacent property located at 488 De Haro. This is a three-story vacant office building totaling 12,528 square feet. This asset would be primed for a renovation or redevelopment into office, retail or multifamily.
There are two main tenants in 444 De Haro. One of these is Discord, a video and text app that was founded in 2015. It has a lease for 83,170 square feet that covers 59 percent of the property. Discord’s lease runs until January 2031, and the space they are leasing is used as a corporate headquarters for the company. The other tenant in the property is Invitae, a leading genetics technology company. The firm takes up 39,289 square feet, or roughly 28 percent of the building, with a lease that expires in April 2031. This is a secondary location for the tenant, which is headquartered just one block away.
There will be an opportunity for the new owner to add some value to the asset in the future. Roughly 20,000 square feet of leases roll over the next two to three years. This presents a mark-to-market opportunity for the next owner, and it’s a scenario that should create strong interest in the property from either core or core-plus capital sources.
444 De Haro is now 100 percent leased. The asset is a two-story building, and it includes an on-site parking operation that has a total of 67 stalls. The property also has a shuttle service that can get employees to both BART and Caltrain.