By Jon Peterson
Los Angeles-based Kilroy Realty Corporation has been selected to be the buyer of the 120,000 square foot 345 Brannan Street office building located in San Francisco’s SoMa neighborhood. The sales price is projected to be in the range of mid to high $1,300 per square foot range, according to multiple sources that are aware of the transaction. The deal has not closed at this time.
If the transaction occurs at the projected sales price, it would set a record for price per square foot for office buildings in San Francisco. The existing record of $1,250 per square foot occurred last year on the sale of 222 Second Street. This is where New York City-based Tishman Speyer bought out New York City-based J.P. Morgan Asset Management.
The San Francisco office of Kilroy Realty did not respond to phone calls seeking comment for this story.
The seller of the property is also the original developer of the building. Breevast, the Amsterdam, Holland-based investment and development firm, broke ground on the development in early 2014, ten years after it had purchased the parcel in 2004. The Charles Bloszies Architecture-designed building replaced a surface parking lot, and it was constructed with some collaboration with Kilroy Realty at the time. Kilroy developed a neighboring building to the west, the 180,000 square foot 333 Brannan.
The listing agent on the sale is the San Francisco office of Eastdil Secured. This firm did not respond to phone calls or emails seeking comment for this story.
345 Brannan is a five-story office building. All of the space in the asset is leased to Dropbox, which also occupies the Kilroy building at 333 Brannan. Given the earlier collaboration between the two firms and joint tenancy, the purchase does not come as a surprise to most professionals in the industry.
In October of 2017, Kilroy announced that it would be relocating Dropbox to its 736,000 square-foot development, The Exchange on 16th, where the cloud storage company took the entire project. According to industry sources, Dropbox is projected to vacate the buildings at 333 and 345 Brannan, which would give Kilroy an opportunity to provide a corporate campus setting to a new tenant.