Hotel, Office Tower to Rise Next to Transamerica Pyramid After Years of Delays
The area around San Francisco's most recognizable skyscraper is shaping up to be the epicenter of a downtown recovery. On the block across from the Transamerica Pyramid near the edge of Jackson Square, Related California is moving forward with plans to build a 41-story tower with 360,000 square feet of office space and a 200-room five-star hotel — finally after a long delay in part caused by the pandemic.
Related aims to secure approvals by October and break ground at the end of next year for the nearly 550-foot-tall mixed-use project, which will be built on the site of San Francisco Fire Department Station No. 13 at 530 Sansome Street, the San Francisco Chronicle reported.
The firm began working on the project in 2017, responding to a city solicitation for a private group interested in developing the 530 Sansome site in exchange for building a new fire station for the city.
In 2020, the developer won approvals for a 200-room hotel and fitness center above a new fire station, but the project withered during the pandemic and the lingering malaise of the city’s downtown that followed, which saw office vacancy rates in San Francisco peak at nearly 37% at the end of last year.
Now, with the North Financial District area around Jackson Square leading an emerging recovery, the planned mixed-use tower at 530 Sansome is “the right building in the right location at the right time,” Matt Witte, Related California’s executive VP of acquisitions and development, told the Chronicle.
The newly renovated Transamerica Pyramid is expecting to ink several large leases in the coming weeks. The landmark tower, which has seen its base office rent jump from $60 per square foot during the pandemic to about $115, is asking $300 per square foot for its top floor, the San Francisco Business Times reported.
In the past year, the nearby Jackson Square neighborhood has been giving off the hottest recovery vibe in the city, with a bevy of new stores, restaurants and a jump in foot traffic.
Earlier this month, chef Peter Helmsley and San Francisco-based developer Brick & Timber Collective closed a $32M deal to acquire 530 Jackson Street, a four-story building that has been the longtime home of Kells Irish Pub and Restaurant. The purchase price translates to more than $2,000 per square foot.
The deal is the latest big-ticket building sale in Jackson Square. Former Apple designer Jony Ive has spent almost $100M acquiring real estate in the area, which is known for its fine dining scene.
A few blocks from 530 Jackson, Brick & Timber partnered with Barings at the end of last year to buy 500 Washington Street, a 100K square foot office building, for about $33M, or $326 per square foot.
Related California is aiming to deliver its mixed-use tower at 530 Sansome by 2030. The project, which includes a new fire station at 447 Battery Street, is being designed by Skidmore, Owings & Merrill.
According to the Chronicle, the tower would be the first North Financial District building delivered since 350 Bush Street opened in 2018 and the first new ground-up five-star hotel in downtown San Francisco in 30 years.
Source: GlobeSt/ALM