September 14, 2016
New York-based Paramount Group, Inc. agreed to acquire One Front Street, a 38-story 651,000-square-foot office building located in San Francisco’s highly desired Market Street corridor. The purchase price for the 99.4% leased Class A asset is $521 million, or roughly $800 per square foot.
The Florida State Board of Administration owned the asset through a separate account relationship with Atlanta-based Invesco Real Estate. The deal, which was handled by Eastdil Secured, is expected to close by the end of this year.
Paramount’s Albert Behler says the company recognized an opportunity to capture value through proactive management and bringing existing leases up to market rents, which is expected to “meaningfully increase the net operating income.” Paramount is also “evaluating certain redevelopment opportunities, which could unlock additional value in the next three to five years.”
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