Paramount Group Inc has agreed to acquire San Francisco-based 55 Second District, an office building, for about $408 million. The deal is expected to close in the third quarter of this year.
NEW YORK–(BUSINESS WIRE)–Paramount Group, Inc. (NYSE: PGRE) (“Paramount” or the “Company”) today announced that it has entered into an agreement to acquire 55 Second Street, a 387,000 square foot trophy office building located in San Francisco’s South Financial District, for approximately $408 million or $1,054 per square foot. The transaction, which is subject to customary closing conditions, is expected to close in the third quarter of 2019. In connection with the transaction, the Company expects to bring in a joint venture partner prior to closing.
“The acquisition of 55 Second Street enables us, once again, to recycle capital opportunistically from Washington, D.C. into one of San Francisco’s most desirable corridors,” stated Albert Behler, Chairman, Chief Executive Officer and President. “With its modern construction, highly efficient floor plates, rich amenity base and proximity to the Transbay terminal, we see tremendous opportunity to fill existing vacancy as well as proactively manage renewals and any potential rollover in a building where in-place office rents are well below market.”
Developed in 2002, 55 Second Street sits in the highly desirable Mission-Market Street corridor and is within one block of the new Transbay Transit Center and nearby Montgomery BART station. The property is currently 87.4% leased primarily to accounting, legal and technology tenants. The property’s efficient, nearly column-free floorplates with multiple accessible outdoor terraces position 55 Second Street to appeal to a modern and diverse tenant base. The property offers 13-foot slab-to-slab ceiling heights and large windows, allowing for abundant natural light into tenant spaces and providing sweeping views of the city. In addition, a two-story subterranean parking garage can accommodate approximately 120 vehicles, providing a unique and highly desirable tenant amenity.
The property is LEED Platinum certified and boasts an Energy Star rating of 94.
About Paramount Group, Inc.
Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City, San Francisco and Washington, D.C. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.