Building Sold at 60% Discount to be Office-Resort in San Francisco
Developer to add luxury amenities to 56-year-old Spear Street tower.
When Presidio Bay Ventures acquired a 157K SF office tower at the corner of Spear and Mission streets in August, the transaction was emblematic of the massive discounts being offered on aging office properties in San Francisco.
The San Francisco-based firm bought the 11-story building at 60 Spear Street, a 56-year-old office building in the city’s Financial District, for $41M from Clarion Partners, which acquired the property in 2014 for $107M.
Now, the buyer is unveiling ambitious plans to make the building an emblem of a recovery in downtown San Francisco with a multi-million-dollar renovation that will transform the property into a luxury “office-resort.”
Presidio Bay filed plans this month to enlarge and enhance the building with trophy hospitality amenities including a 7,700 SF rooftop bar and restaurant, sauna rooms, cold and warm water plunges, saltwater floating pools, coworking space and a café bakery, according to a report in the San Francisco Business Times.
The rooftop restaurant, which will replace penthouse office space, will be served by its own private ground-floor entrance. On the ground floor, the café and coworking space will fill retail space that has been vacant since 2022.
Nearly 4,000 SF in the building’s basement also is earmarked for amenities, potentially including a health spa and fitness center, to attract office tenants.
Renovations on the building’s second floor will create a full floor plate, adding about 2,500 SF of office space, the report said.
Presidio Bay’s plans, which the company describes as the city’s first “office-resort,” will expand the Spear Street building’s overall footprint to 170K SF and make luxury amenities common to large tech players accessible to tenants with smaller footprints, according to the report.
According to the filing, the renovation, expected to begin later this year, will be designed by Washington, DC-based OTJ Architects.
The office vacancy rate hit 36.6% in San Francisco during the first quarter of 2024, up from 35.6% in the fourth quarter of 2023. Total availability, which includes occupied space, ticked up to 38.7% from the 38.5% recorded at the end of 2023, according to preliminary data from CBRE.