By Jon Peterson
A private buyer has acquired the 135-car parking garage in downtown San Francisco located at 524 Powell Street for $9 million, as stated by sources that were aware of this sale.
The seller of this property was also a private entity. It was represented in the transaction by the San Francisco office of NKF Capital Markets. The people involved in this trade were Michael Taquino, Kyle Kovac and Daniel Cressman, all executive managing directors, and Mandy Lee, director. NFK declined to comment when contacted for this story.
The Property, which is a condominium interest contained within the 400-room San Francisco Marriott Union Square Hotel, directly serves guests of the luxury hotel and is also open to customers for valet parking on an hourly, daily, and monthly basis, according to the property’s flyer. The asset can accommodate a total of 135 cars, and it is a 100 percent parking valet operation. The asset covers a total of 40,000 square feet, and it has four floors.
524 Powell is known as a property with very strong occupancy. This is reflected in that the sale of the property produced a five percent cap rate, according to sources familiar with the property. The structure itself was constructed in 1972, and it sits on a site that is nearly 19,000 square feet.
The garage is approximately one block away from Union Square, which is one of San Francisco’s most visited retail and tourist destination. It is also home to dozens of brand name hotels such as the Westin St. Francis and the Grand Hyatt.
There are a number of parking garages in San Francisco that have been re-developed into other types of real estate over the past several years, which has created parking scarcity in the city. Also, San Francisco legislators have effectively discouraged parking construction in the city with new residential and commercial developments.
This gives the new owners of 524 Powell an opportunity for a long-range plan to keep the asset operating as a parking facility.