Paramount Group, Inc. has completed the acquisition of a 44% joint venture interest in 55 Second Street. Located in San Francisco’s South Financial District, the property was valued at approximately $402.0 million, or $1,039 per square foot.
In an unrelated transaction, Paramount Group also announced that it has entered into an agreement to acquire Market Center, a two-building Class A office complex comprising 753,000 square feet, located in San Francisco’s South Financial District.
The complex consists of 555 Market Street and 575 Market Street comprising 280,000 square feet and 473,000 square feet, respectively. The purchase price is approximately $722.0 million or $959 per square foot.
The transaction is expected to close in the fourth quarter of 2019. In connection with the transaction, the Company expects to bring in a joint venture partner prior to closing.
“We continue to opportunistically redeploy capital in one of the most desirable markets in the country at an attractive basis. We plan to aggressively manage future rollover at the property, where in-place rents sit well below market in a city with very limited new office supply and strong tenant demand for large-block availabilities,” said Albert Behler, Chairman, Chief Executive Officer and President.
Market Center is currently 94% leased primarily to technology and professional services tenants. The two buildings are uniquely linked by a landscaped garden plaza and elevated walkway, and are located within walking distance of all major local transit systems including the Montgomery BART station, the Transbay Transit Center and the San Francisco Bay Ferry.