By Jon Peterson
New York City-based Blackstone Real Estate Partners has put up for sale two-building, 753,000 square foot Market Center office asset located at 555 and 575 Market Street in San Francisco. The potential asking pricing for the property is projected to be approximately $1,000 per square foot or $753 million, according to multiple sources familiar with the sale of the property. This potential pricing level will make this sale one of the largest office building trades of the year in San Francisco.
Blackstone declined to comment when contacted for this story. The real estate investment firm has hired the San Francisco office of Eastdil Secured as the listing agent on the sale.
Blackstone has been the owner of the property since June 2016. It had paid $510 million for the two buildings at that time, according to public records. The real estate investor has owned the property through its office building operating platform with EQ Office, formerly known as Equity Office.
The size of this transaction would likely limit it to major institutional investors that are located in the United States or from outside of the country. This would likely include pension fund managers as well as sovereign wealth funds.
The property is in a strong location. It is situated very close to public transportation, which most top-level tenants are seeking. This includes both the Montgomery Street BART station as well as the Muni. The property is leased to a variety of tenants one of which is Uber.
Market Center does have a strong mix of amenities. This includes bicycle parking, locker room and showers for employees who are interested in riding a bicycle to work.
Market Center, formerly known as the Standard Oil Buildings and later the Chevron Towers, is a complex comprising two skyscrapers at 555–575 Market Street in the Financial District of downtown San Francisco, according to the property’s Wikipedia entry. It served as the headquarters of the Chevron Corporation until 2001.
575 Market Street is a 40-story building completed in 1975, the taller of the two towers. 555 Market Street is the shorter tower at 22 stories, and was completed in 1964. The two buildings are surrounded by small ornamental plazas, and both buildings are terra cotta over a granite base.