Except this parking lot, at Howard and First streets in San Francisco, is located in one of the hottest commercial real estate markets in the country.

Late last week, New York’s Tishman Speyer Properties closed escrow on the space, which, by the end of next year will be transformed into a 10-story, 286,000-square-foot office building serving “tech tenant demands and needs perfectly,” said Allen Palmer, managing director at Tishman Speyer’s San Francisco office, in an e-mail to Bay Area real estate brokers.

Two distinguishing aspects of the deal: It’s the first “spec development” (i.e. built from the ground up with no signed tenants) in the city since the onset of the recession in 2007, and no debt financing is involved. The land, architectural plans and construction costs – the latter estimated between $180 million and $185 million – is “funded with all equity,” said Palmer.

“Tishman has just turned on the light switch,” said Daniel Cressman, executive vice president at Grubb Ellis, suggesting that San Francisco’s tech-driven market, especially in the South of Market area, may see similar deals in the near future. (Grubb Ellis, which was recently acquired by New York’s BCG Partners, is not involved in the Tishman Speyer deal.)

In fact, Tishman Speyer cut an even bigger spec deal at 222 Second St., which is also a parking lot. Scheduled to begin construction next year and to be open for tenants in the fall of 2014, the “world-class” $100 million, 27-story, 452,000-square-foot high-rise is “purposely designed … to cater to the tech user, yet also appeal to the professional, traditional office space user,” said Palmer.

Partnering with Tishman Speyer in both deals is JPMorgan Chase Asset Management, which bought a majority stake in China Basin Landing in January for $415 million. Like Tishman Speyer, which owns 555 Mission St., another spec project, and Infinity Towers, the upscale condo complex on Spear Street, JPMorgan has identified South of Market as the place to be.

“The demand is relentless, especially for tech space,” said Michael Covarrubias, CEO of TMG Partners, which is putting the finishing touches on the retrofit of 1275 Market St., a 17-story office building across the road from Twitter’s soon-to-be-occupied new headquarters.

The space at Howard and First streets is part of the 1.2 million-square-foot Foundry Square development, originally designed for Sun Microsystems. Three architecturally similar 10-story buildings are occupied by Oracle, the law firm of Orrick, Herrington Sutcliffe and BlackRock, the global investment management company.

The fully leased BlackRock building reportedly has been sold for $240 million by another New York property company to the State Teachers Retirement System of Ohio. A second Foundry building, owned by Utah Retirement Systems and leased to Oracle, was put on the market in February, with a reported asking price in the $185 million range, “or just shy of an eye-popping $800 per square foot,” according to Real Estate Alert, an online newsletter.

“Our initial goal is to find one tenant” for the space at Howard and First streets, Palmer told potentially interested brokers. “But don’t let that goal get in your client’s way if they would like to pursue part of the building.”

Buyers’ market: If San Francisco real estate is a little too rich for your blood, how about Oakland? Home sales are up, especially in the condo market, and property developers are keen to show you their wares.

A number of developers and real estate firms, including Holliday Development and Uptown Place, are part of a monthlong business campaign called Passport Oakland, designed to entice folks to experience a city that has had some not-so-good press lately. Five “new home communities” are available for inspection, plus neighborhood tours. Barbecues, wine tasting, deals on meals and $100 gift-card prizes are among other incentives.

More information at passportoakland.com and on Facebook (Facebook.com/PassportOAK) and Twitter (#PassportOAK).

Andrew S. Ross is a San Francisco Chronicle columnist. Blogging at www.sfgate.com/columns/bottomline. Facebook page: sfg.ly/doACKM. Tweeting: @andrewsross. E-mail: bottomline@sfchronicle.com.

This article appeared on page D – 1 of the San Francisco Chronicle

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/04/09/BUET1O0RN2.DTL&type=tech

“We’re very, very fortunate in San Francisco,” Ting told SFAppeal. He also predicted that the growth will only continue here in SF in the coming years.

(SCROLL DOWN FOR PHOTOS)

This may be news for Bay Area buyers and sellers, but real estate agents aren’t surprised.

“This city is a gold mine for real estate,” Rick Teed, cofounder of real estate and development company Teed Haze, told HuffPost. “If you have a house with no view, but it’s redone and in a neighborhood like Pacific Heights, it’s going to be north of $1000-per-square foot for starters.”

Teed agrees with Ting’s prediction that the market will only continue to grow. “We are a seven-by-seven-square-mile city,” said Teed. “There is no new land.”

Daniel Cressman, executive vice president of the commercial real estate company Grubb El, also commented on our city’s limited space. He told NBC Bay Area that San Francisco is “one of the very few markets in the entire country where investment demand for commercial office space is far outstripping the available supply that’s for sale.”

To celebrate this news, we contacted Sotheby’s International Realty and got some pictures of a home they are especially excited about. Check out this unreal Gold Coast-style 1927 home designed by Willis Polk Co. in Pacific Heights. We would move in tomorrow if it weren’t for that $25 million price tag.

Take a look at images of this amazing home below:

‘;
var coords = [-5, -72];
// display fb-bubble
FloatingPrompt.embed(this, html, undefined, ‘top’, {fp_intersects:1, timeout_remove:2000,ignore_arrow: true, width:236, add_xy:coords, class_name: ‘clear-overlay’});
});

Article source: http://www.huffingtonpost.com/2011/07/22/san-francisco-real-estate-best-market-in-state_n_907245.html

advertisement

San Francisco Assessor-Recorder Phil Ting announced Thursday that the value of the City’s real estate grew by nearly $2 billion in the past fiscal year, a contrast to decreasing property values in most other parts of California.

The total roll assessment value, a combination of residential and commercial property values, grew by 1.3 percent to $163 billion during the fiscal year that ended June 30.

“We’re very, very fortunate in San Francisco,” Ting said. “We still have the strongest real estate market in the state.”

He said many homeowners are still worried about the real estate market but predicted “we’re going to see a continued resurgence” in the coming years.

Daniel Cressman, executive vice president of the commercial real estate company Grubb Ellis, said the value of the city’s commercial properties are doing particularly well.
   
San Francisco is “one of the very few markets in the entire country where investment demand for commercial office space is far outstripping the available supply that’s for sale,” Cressman said.
   
That has led to property value increases of up to 40 percent in recent years, he said.

John Lee, the former president of the San Francisco Association of Realtors, said the residential market is not doing as well, particularly for middle-class homeowners.

“People worried about jobs can’t commit to a long-term financial obligation,” Lee said.

He said, “I think the worst is behind us,” but predicted the next few years for the market will probably be about the same as the past one.

About 18,800 owners of single-family homes received a one-year temporary reduction last year in the assessed value of their properties, saving them a combined $27 million in taxes, Ting said.

Copyright Bay City News

Article source: http://www.nbcbayarea.com/news/local/SF-Real-Estate-Strongest-in-the-State-126021233.html