San Francisco-based Unity Technologies, the makers of a gaming engine employed by numerous gaming enterprises is taking space at 657-667 Mission Street, two adjacent historic office buildings totaling approximately 150,000 square feet in the heart of San Francisco’s South Financial District, according to a report by the San Francisco Business Times.
The company will be relocating from its current offices at 30 3rd St., the 53,000 square-foot building in SoMa, which is roughly a block away from the new offices.
The new office buildings were acquired in February of 2017, as first reported by The Registry, in a sale worth $64.6 million. At the time, Coast Counties Property Management sold the properties to a join venture between Align Real Estate & Vanke Holdings USA. The deal included a five-year, non-recourse, floating-rate acquisition financing by Square Mile Capital Management, which included a 70 percent loan-to-cost initial funding and ability to draw future funding for capital improvements and lease-up costs going forward providing a total loan commitment of $70 million.
Built in 1907 and 1916 respectively, 657 and 667 Mission Street present both historic architecture and the opportunity for creative renovation, according to a statement by the owners. The buildings also boast an excellent location, situated one block south of Market Street—providing access to both BART and Muni—and one block from the Transbay Transit Center. The location also offers close proximity to some of San Francisco’s top amenities, including upscale dining options, boutique hotels and numerous entertainment and cultural attractions such as the San Francisco Museum of Modern Art, Yerba Buena Gardens and the Metreon.
Mark Geisreiter and Alexis Walsh of CBRE were listed as the leasing team for 657-667 Mission Street on behalf of the joint venture. They were not available immediately for comment.
The deal with Unity follows two announcements in the last week that included Amazon taking additional 143,000 square feet to bring its total to 319,000 square feet in 525 Market Street, as well as PwC taking 200,000 square feet at 405 Howard Street.
The market is seen by brokerage firms in the city to be very strong, with vacancy dropping to 7.7 percent, according to a second quarter of 2018 San Francisco Office Insight report by JLL. With 4.6 million square feet of office under construction, JLL saw over 1.8 million square feet of net absorption in the year to the end of the quarter. With supply dwindling, the market is seeing notable rental rate increases, up 2.2 percent quarter-over-quarter, stated the report. These three leases over 100,000 square feet in the last week were matched by the three such leases in the second and first quarters, as well. Most notable was the full-building lease signed at Park Tower, which is currently under construction. The 755,900 square-foot lease toppled Dropbox’s 2017 lease at the Exchange as the largest office transaction in San Francisco history. Cruise Automation leased 381,517 square feet at 301, 333 and 345 Brannan, while Nektar Therapeutics took 136,000 square feet at 360 3rd.