SAN FRANCISCO-Those who follow @GlobeStcom on Twitter and @GlobeStLIVE may have seen a post teasing the announcement, but GlobeSt.com has learned that the Transbay Joint Powers Authority board of directors finalized the agreement to sell TJPA property for $190 million, paving the way for construction of the landmark Transbay Transit Tower. In October, GlobeSt.com reported that this was the first JV between Hines Corp. and its 50/50 JV partner, Boston Properties.
The State of California donated the Tower site to the TJPA for construction of the 61-story Tower, which will contain 1.4 million square feet of office space and serve as a beacon for the City’s Transit hub in the heart of downtown San Francisco. Hines has agreed to purchase the 50,000 square foot Tower site, located directly north of the future Transit Center fronting on Mission Street, for more than $190 million. On a per square foot basis, the sale price for the Tower site is the highest paid for a large development property in San Francisco history, according to a prepared statement.
“This agreement marks another major milestone in the development of the new Transbay Transit Center,” notes executive director of the TJPA, Maria Ayerdi-Kaplan. “The proceeds from the sale of the Tower site and other Transbay parcels will be invested directly into the Transbay Transit Center Program. This historic project is creating jobs, stimulating economic growth in our City and region, giving back to the community, creating housing, and helping the environment.”
In a previous statement, Hines chairman Gerald D. Hines says, “We think the tower will be a beautiful addition to San Francisco’s beloved skyline as well as an extremely desirable and sustainable workplace next to one of the state’s busiest transit hubs.” Hines and Pelli Clarke Pelli Architects were selected by the TJPA in September 2007 to develop the property adjacent to the Transbay Transit Center, which began construction in August 2010.
The acquisition is expected to close in the first quarter of 2013.
Both Houston-based Hines and Boston-based BXP are active in the Bay Area. Hines’ portfolio includes 17 San Francisco-area properties, the largest of which is the 1.3-million-square-foot 101 California. BXP’s holdings here include the four-million-square-foot Embarcadero Center office and retail complex.
The Transbay Tower and the Transit Center are both designed by Pelli Clarke Pelli, the architecture firm chosen in a 2007 design and development competition. At 1,070 feet, the Tower is slated to be the tallest building on the West Coast and will transform the skyline of downtown San Francisco. The approval of the purchase and sale agreement comes on the heels of the San Francisco Planning Commission’s approval of the tower height.
“The Transit Center and Tower are two projects that are transforming transportation in our City as well as transforming the SoMa neighborhood,” said Mayor Ed Lee. “The TJPA’s newest transaction to advance these two projects is critical to the investment in the future of San Francisco.”
The Transbay Transit Center, known as the “Grand Central Station of the West,” is a revolutionary transportation facility that will transform the South of Market District into the new heart of downtown San Francisco. The Transit Center will connect eight Bay Area counties and 11 transit systems, including future High Speed Rail. The money from the purchase of the Tower parcel will help fund construction of this state-of-the-art, LEED Gold facility and national model for transit-oriented development. The $4.2 billion project is scheduled to be completed in the fall of 2017.
A ground break date for the Transbay Transit Tower has not yet been determined.
Be sure to visit GlobeSt.com's NEW Sectors-to-Watch page for in-depth looks on the Hotels, Industrial, Multifamily, Office, Retail, Student Housing, Net Lease and Healthcare Real Estate markets.