Hines, NPS JV plans $2.5bn project in San Francisco

Hines, NPS JV plans $2.5bn project in San Francisco
Image: Courtesy of Hines

Hines and the National Pension Service of Korea (NPS), a South Korean pension fund, have acquired the historic Pacific Gas & Electric Company (PG&E) campus in the South Financial District in downtown San Francisco.

Hines and its partner NPS will redevelop the site of PG&E’s headquarters with a $2.5 billion-plus office and multifamily apartment project.

”Upon completion, the PG&E campus will represent the largest deal along Market Street in San Francisco in the last 10 years, and deliver two next generation office projects totaling approximately 1.6 million square feet and a future multifamily component,” said Hines in a press release.

The first of the two office projects will consist of the restoration and renovation of a 600,000-square-foot office complex dating back to the early 1900s. Hines plans to honor the building’s history and architectural integrity while elevating the office experience to trophy historic product quality. Hines will retain the historic architecture of the building facade and the original lobby but upgrade the building’s systems and technological capabilities to achieve the modern functionality of a Class-A office building.

77 Beale, to be renamed 200 Mission, is an existing 1,000,000-square-foot, 34-story tower which will be repositioned into a brand-new, premier office tower oriented toward Mission Street.

Hines will completely transform the existing dated building into a state-of-the-art tower including all new systems and aesthetics. Led by Pickard Chilton, the future-facing design will meet the needs of a range of occupiers seeking to entice the next generation of workforce talent.

Lastly, Hines anticipates commencing development of 50 Main, a new multifamily apartment complex that will consist of over 600 units. More details will be released in relation to this ground-breaking residential site in the future.

“The site of PG&E’s headquarters is undoubtedly one of the best locations along the entire West Coast and we believe these projects will be the epitome of the next generation of office buildings, designed to answer future tenant needs by addressing what their employees want,” said Paul Paradis, senior managing director at Hines. “We are excited to be on the front lines of cutting-edge innovation in the built environment.”

As part of the joint venture that NPS and Hines formed last year, this project aims to capture evolving demands by modernizing spaces across the real estate industry.

“This venture targets a build-to-core strategy to create a portfolio of prime assets resilient to market uncertainties,” said Scott Kim, Head of Real Estate Investment Division at NPS. “This project embodies NPS and Hines’ belief that long-term investments in proven locations, supported by innovation and new technology, will capture sustained demand and create outsized value.”

“We have been able to capitalize on an ideal project in the heart of San Francisco to create three emblematic projects that are representative of the future of real estate,” said Alfonso Munk, CIO of the Americas at Hines. “We are very excited to see this project come to life and set the bar for many more projects between Hines and NPS in the future.”

“The Hines vision for this important block in the heart of downtown San Francisco is great news for the future of our city,” said Mayor London Breed. The proposed mix of uses – including residential, retail and office – addresses a crucial need for housing while bringing more economic vibrancy to our city. We look forward to seeing Hines deliver this exciting new addition to our community.”

Hines has a long involvement with the PG&E campus, having completed a redevelopment project in the mid-1990s and served as property manager for a decade following. The PG&E project is located directly across the street from Hines’ landmark 101 California, developed in 1982, and nearby several other Hines signature projects in the area.