LaSalle to Buy 450 Sansome in San Francisco for $89MM

LaSalle, 450 Sansome, San Francisco, LaSalle Investment Management, ornerstone Real Estate Advisors, Orange County Employees Retirement System

450 Sansome San Francisco real estate The Registry
By Jon Peterson

Chicago-based LaSalle Investment Management has been chosen as the buyer of the 133,000 square foot 450 Sansome Street office building in San Francisco. The purchase price will be around $670 per square foot or $89.1 million, according to sources that track the sales of office buildings in San Francisco.

A company representative of LaSalle declined to comment when contacted for this story.

The seller of the property is Hartford, Conn.-based Cornerstone Real Estate Advisors. This real estate manager is projected to earn a significant profit on the sale. It had acquired the property in January of 2013 for $51 million or $383 per square foot. It had placed the latest value on the property at $75 million, according to industry sources.

450 Sansome is now considered to be a core asset, and the property is now 100 percent occupied. The major tenants in the property now are Umpqua Bank, ABD Insurance and SillaJen Biotheraputics. The property was first constructed in 1965 and was last renovated in 2008.

Cornerstone had acquired the property for its commingled fund, Cornerstone Real Estate Fund VIII. This is a value-add commingled fund. There was a total equity raise on the commingled fund of $546 million that was concluded in March of 2012. One of the investors in the fund was the Orange County Employees Retirement System.

Fund VIII is now in a liquidation period. 450 Sansome was the only asset in the commingled fund that was located in San Francisco. The investment fund does own a property in Los Angeles.

450 Sansome is part of the North Financial District sub-market in San Francisco. This region had a current vacancy in the first quarter of 7.8 percent, according to date from the Colliers International office in San Francisco. Vacancy had been at 8.1 percent at the end of 2014. The sub-market has a total of 116 buildings covering 28.4 million square feet.

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