KBS Strategic Opportunity REIT Completes Purchase of San Francisco Office Tower for $170 Million
KBS Strategic Opportunity REIT, a non-traded real estate investment trust, California, purchased 353 Sacramento located in San Francisco’s Financial District for $169.5 million.
As previously reported by The DI Wire, the company signed an agreement in May with Pacific EIH Sacramento LLC to purchase the property.
Built in 1982, 353 Sacramento is a 23-story, Class A office tower with approximately 274,000 square feet of office space and 11,000 square feet of street-level retail. The property’s onsite amenities include a conference center, a full-service banking branch, and a deli.
“We believe that 353 Sacramento’s location in San Francisco’s vibrant Financial District will appeal to both traditional and creative tenants,” said Michael Potter, vice president at KBS and asset manager for the property. “We are pleased to acquire this property in a highly desirable business location and a center of global technology innovation.”
The property is located adjacent to Embarcadero Center, which has more than 100 restaurants and shops, and two blocks from a Bay Area Rapid Transit station and the Market Street Corridor.
353 Sacramento is currently 85 percent leased to 25 tenants, including Berry, Appleman & Leiden, a corporate law firm, Landmark Worldwide LLC, a company offering personal development and training programs, and law firm Carlson, Calladine & Peterson LLP.
The current aggregate annual effective base rent for the tenants of 353 Sacramento is approximately $9.6 million. The current weighted-average remaining lease term for the tenants is approximately two years and the current weighted-average annual rental rate over the remaining lease term is $45.19 per square foot.
KBS Strategic Opportunity REIT, which went effective in November 2009 and closed in November 2012, raised $561.7 million in its primary offering and has sold $56 million in DRIP shares. The REIT owns 26 office buildings, one retail property, two multifamily properties, two investments in undeveloped land totaling 1,670 acres, one first mortgage loan and two investments in unconsolidated joint ventures, according to the most recent quarterly filing with the Securities and Exchange Commission.