The Ross Dress for Less building became the fourth San Francisco property that ASB Real Estate Investments has sold at a loss in less than a year.
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The 145K SF building sold to San Francisco-based Sansome Street Advisors for $44M, about $300 per SF, according to the San Francisco Business Times. The tower at 799 Market St. sold for just a third of its 2016 purchase price.
Office space accounts for 90K SF of the building, with 52K SF of that available for lease. Another 55K SF houses the Ross flagship store, which sees so much foot traffic that a second location is set to open just a block away at 901 Market St.
Sansome Street Advisors also owns two other properties on Market Street within two blocks of the new acquisition.
It is a tale of two real estate markets in this corner of the city.
Although office vacancy rates rose 1.2% to 34.7% in the first quarter, an office tower at 300 Howard St. in nearby SoMa sold for $111.3M. Developer DivcoWest plans to upgrade the space for artificial intelligence tenants. The move is part of the company’s effort to rebrand the neighborhood as AI Alley.
Others have taken note of the trend, including the Wharton School of the University of Pennsylvania, which will launch an AI program for MBAs later this year and is considering a move to a nearby building at 345 Montgomery St.
Other AI companies set up shop in the area, including OpenAI, Notion and Lambda, all of which signed leases in the latter half of 2024.
The vacancy rate in nearby Union Square ticked up to 22.8% in the first quarter, according to Cushman & Wakefield. But an upcoming spate of new retail openings, including the second Ross location, signals renewed interest in the area.
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