Blackstone, DivcoWest Pay $111M for San Francisco Tower
In the largest post-pandemic deal in San Francisco, a joint venture between DivcoWest and Blackstone Real Estate has paid $111 million for 199 Fremont Street, a 25-story office building, according to The Real Deal.
The new ownership will rebrand the 420,000-square-foot high-rise as 300 Howard Street. The property is currently vacant. Plans call for multiple capital improvements, including amenity upgrades, such as a wellness and fitness center and a conference facility.
DivcoWest already owned a 49 percent stake in the asset, according to CommercialEdge. The firm paid $186.2 million for it in November 2019. The other owner was an entity related to CalSTRS.
The Class A property came online in 2000 and is LEED Gold-certified. Located at 199 Fremont St. in the city’s South Financial District, the transit-oriented building is less than 3 miles from downtown San Francisco. The city’s international airport is 13 miles away.
The high-rise has 7,100 square feet of first-floor retail space, 10 passenger elevators and more than 160 parking spaces, along with a renovated lobby, gym, courtyard and tenant lounge. Floorplates range between 13,212 and 23,198 square feet.
San Francisco sales activity lags behind peer metros
San Francisco’s office investment volume year-to-date through March clocked in at $190 million, according to the latest CommercialEdge office report. Although total sales lagged behind most peer markets, assets in the metro traded at $259 per square foot—significantly higher than the $183 national average.
Deals continued to pencil out in April. LendingClub Corp. agreed to acquire 88 Kearny St., a 233,887-square-foot asset in downtown San Francisco for $74.5 million. The financial services company will use part of the building for its headquarters.
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