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A retail space in San Francisco's Union Square neighborhood sold, trading for $521 per SF despite its significant vacancy rate.
The property includes two buildings totaling 54K SF at 838-842 Market St. A joint venture paid $30M for the property, as reported by The Real Deal. The per-SF price is just shy of the $558 per SF market average, according to a first-quarter report from Kidder Mathews.
The property is 52.2% leased, with retailers Converse and Oakley occupying the space. Those leases will expire sometime in early 2023.
The Whittier Trust Co. of Nevada sold the property, represented by Jordan Gomez, Charley Simpson, Julie Taylor, El Warner and Caitlin Zirpolo of Colliers.
“Strategically located between Powell and Stockton on Market Street, the property offers invaluable proximity to the Westfield San Francisco Centre and the iconic Union Square shopping district,” Warner said in a press release. “The prominent area attracts international flagship retailers and millions of visitors year-round. This property is truly a unique retail asset situated at the epicenter of the most productive urban retail district in the Western U.S.”
The sale comes as San Francisco’s retail vacancy rate is up from previous years but starting to trend down slightly, according to the Kidder Mathews report.
A retail vacancy tax just implemented by the city of San Francisco, meant to spur retail occupancy at long-vacant retail properties, has created the question of what the financial burden will ultimately be for landlords unwilling or unable to fill space.
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