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9/16/16
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As reported in the San Francisco Business Times this past week, Invesco Real Estate, the large Atlanta-based global investment firm, is buying The Piers, an 82,158 square foot office and retail development at historic Piers 1½, 3 and 5, from Pacific Waterfront Partners LLC for $103 million, according to property records.
That price works out to a whopping $1,254 per square foot, one of the highest paid in San Francisco. As the SFBT recalled, in 2001 Pacific Waterfront Partners won a bid for a 66-year ground-lease from the Port of San Francisco to control the properties. The developer then spent $64 million to renovate the properties and made the space available in 2006. PWP will stay on to manage the properties for Invesco, which is leased to tenants such as Bloomberg, Hornblower Cruises & Events and fooderies such as La Mar, Hard Water, The Plant and Coqueta.
“When we bid on The Piers, the buildings were so dilapidated that portions were falling in to the Bay,” Simon Snellgrove, the founding principal of PWP, told the Business Times. The structures had been condemned and the renovation of the nearby Ferry Building was still underway. “We based our proposal on the theme of ‘reconnecting the City with its Bay,” Snellgrove said. It was noted that the proposal was risky because it was uncertain if the public would embrace that part of the waterfront, especially since the properties there needed more pedestrian access.
He added that “The Port staff have been fantastic partners, and we have worked together over these past years to create a model for future waterfront rehabilitation and adaptive re-use.”
Invesco, the buyer, now has $73.1 billion in real estate assets in its portfolio. In recent years, the firm has also invested in other San Francisco properties such as 41 Tehama St., an apartment tower site in San Francisco’s Transbay district, and 101 Second St., a 24-story, 388,370-square-foot Class A office tower.
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