A press release from Kilroy Realty broke the news that 1800 Owens Street will be sold for $1.08 billion, breaking records as the second-highest price for a single property in San Francisco and the highest price per square foot in the city history at $1,440 per square foot. The property in question is a recently completed office complex in Mission Bay. Kilroy expects the deal to close at the end of March.
Flad Architects is responsible for the design. The project materials show a mix of glass, timber, steel, and brick with multiple wings focused around a central massing. The architects, considering the area’s diversity in commercial building uses, designed the site to “flexibly accommodate labs as well as offices, promoting collaboration no matter how they were ultimately arranged. Featuring two cores and lobbies, the building was designed to allow for multiple main tenants with street-level identity.” The building is LEED Platinum certified.
Kilroy Realty is the current owner, with speculation circulating about the buyer. SF Chronicle states a source familiar with the deal told the newspaper that the private equity firm KKR is the buyer, though neither KKR nor Kilroy confirmed the speculation. Dropbox Inc has been an anchor tenant for the site since 2015 and even subleased 133,900 square feet to Vir Biotechnology in late 2020.
The press release included a quote from Mayor London Breed, declaring, “this is a resounding sign that people are still excited to be a part of San Francisco and its future. I want to thank Kilroy Realty for their ongoing partnership and collaboration, and recognize them for how they continue to use their development expertise to move forward positive projects that help our economy grow and support the future of our City.”
The 180-foot building yields 970,000 square feet, of which a good portion is taken up by parking and 750,000 square feet is leasable office space. Kilroy purchased the site in 2014 for $95 million. The total development cost for the project was $585 million.
The Boston Properties’ purchase of Embarcadero Center for $1.2 billion in 1998 is the current highest property transaction in the City’s history.