San Francisco's Saks Fifth Avenue Trades Hands

Lincoln Property Co. and Cara Investment have partnered to acquire the Saks Fifth Avenue retail store in San Francisco’s Union Square. The department store retailer has occupied the building for four decades and has a current lease in place through 2027.

Located at 384 Post Street on Union Square, the six-floor, 135,000-square-foot property has 163 feet of retail frontage along Post Street, facing Union Square. It is a flagship property in an iconic retail location, according to Brandon Wang, EVP of Lincoln Popery Co. Union Square has 25,000 daily visitors and the half-mile area generates $1.1 billion in revenue. Other retailers in the market include Tiffany & Company, Williams Sonoma, Apple and Nike.

The San Francisco market was badly impacted by the pandemic, and the retail market was no exception. However, by the third quarter, the retail market managed to find some footing. According to the third quarter stats from Marcus & Millichap, asking rents have increased slightly and asset pricing has stabilized.

This acquisition is the third joint venture between Lincoln Property Co. and Cara Investment, and it builds on an already active year for Lincoln. In August, Lincoln Property Co. formed a multifamily fund with Cadillac Fairview, and the fund acquired Alexan Earl, a 12-story apartment community in the heart of Arlington, Virginia. The Alexan Earl, soon to be renamed The Earl, is the first existing asset acquisition from the $800 million and growing US multifamily fund, co-sponsored by the two companies. The purchase of The Earl jumpstarts their core acquisition initiative. In addition, several assets are expected to close in 2021 across top US markets.

Earlier in April, Lincoln expanded its Midwest presence with the acquisition of the Excelsior Group’s multifamily property management business, Excelsior Multifamily LLC. The acquisition of the Minneapolis-based, Excelsior Multifamily expanded the company’s portfolio and office presence within the Midwest. Excelsior Multifamily currently manages a portfolio of 27 multifamily properties, encompassing nearly 4,500 units in the Minneapolis/St. Paul metropolitan area. With the addition of Excelsior Multifamily, Lincoln Property’s portfolio will more than quadruple in size within the Minneapolis/St. Paul market.