Potential Record Price Coming for $75MM Sale of 500 Pine in San Francisco

LEED, Heitman, Lincoln Property Company, Gemdale USA Corporation, HFF, San Francisco
Image courtesy of Heller Manus Architects

By Jon Peterson

The sellers of 500 Pine Street in San Francisco are looking at a potential record price on a per square foot basis for an institutional office building sale in San Francisco. The guidance price on the property is $75 million or $1,335 per square foot, as stated by sources familiar with the transaction.

At that pricing, the sale could potentially set a new record. The existing record is $1,250 per square foot for the sale of 222 Second Street property that closed in 2017, according to sources that track the sale of office buildings in San Francisco. The 222 Second Street sale involved New York City-based Tishman Speyer buying out its investment partner, J.P. Morgan Asset Management.

The seller of 500 Pine is a venture between Lincoln Property Company and its Chinese partner Gemdale. The sellers have hired the San Francisco office of HFF to be the listing agent on the transaction. HFF declined to comment when contacted for this story.

500 Pine is an office building that was completed just last year by the sellers. The property totals 56,179 square foot and today is fully leased to Blend, a financial services technology startup company.

The sources estimate that the potential record price for 500 Pine may not hold for long and could be eclipsed by other deals that should be coming on the market before long. One of the reasons for this is that San Francisco remains a top investment market for many major institutional investors in both the United States and on a global basis. The strong fundamentals of the Bay Area economy and the companies that are based here are a major draw for investors. These capital sources have a lot of capital to invest that is seeking a home.

The property is on the corner of Pine and Kearny, across the street from 555 California Street Bank of America Financial Center. The LEED Gold property was designed by Heller Manus Architects and is a mid-rise commercial building with rooftop addition to St. Mary’s Square Park built in conjunction with the nearby 350 Bush Street property.

The five-story building also includes a small mechanical penthouse on the roof and one full basement level with parking, according to the architect’s web site. The first four stories are full floor plates with the fifth story being a partial floor plate.

West Coast Commercial Real Estate News