Originally completed in 1902 at 116 New Montgomery St. in theSouth Financial District, the Rialto Building has eight stories ofoffice space above street-level and mezzanine retail space. Theproperty is 88% occupied by tenants including Trust for PublicLand, Walgreens and Chipotle Grill.

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Wilemon and director Zane Sweet (HFF San Francisco) worked onbehalf of Steven Firtel, corporate counsel and director ofdevelopment for Bomel. Firtel says the financing "will enable us toimplement a long-term leasing and capital improvements plan on theRialto."

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HFF managing director Larry Wilemon says proceeds from thethree-year loan also are being used to defease the existing loan onthe property and pay off an unsecured note. Bomel intends to holdthe property long term, he says.

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"The Rialto Building is a tremendous value-add opportunity dueto a majority of the leases being below market and expiring withinthe next six to 36 months," Wilemon says. "In a market that hasseen rents increase from $24 per square foot to roughly $40 persquare foot for Class B office space, this is a perfect time forthe current owners to reposition the building and raise rents tomarket levels."

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