Hudson Pacific Buys $39M Rincon Center Interest

SAN FRANCISCO-Hudson Pacific Properties has acquired the remaining 49% interest in the 581,000-square-foot One and Two Rincon Center office complex for $38.7 million, giving it full ownership of project in San Francisco's South Financial District. The Los Angeles-based REIT acquired the other 51% interest in the property late last year for $40.3 million, according to a GlobeSt.com report at the time. According to that report, Hudson Pacific bought the 51% interest from Beacon Capital Partners and reached an agreement to acquire the remainder of the Rincon Center properties for a pre-agreed price.

In conjunction with the acquisition, the company closed a seven-year, secured, non-recourse loan in the amount of $110 million from JPMorgan Chase Bank. Interest under the new loan is payable monthly at a fixed annual rate of 5.134%. The purpose of the loan is to fully refinance an existing $106 million project loan on the property that was scheduled to mature on July 1.

Victor J. Coleman, chairman and CEO of Hudson Pacific, in an announcement regarding the acquisition commented: “This transaction is part of our investment strategy to acquire desirable properties in highly sought-after Northern California commercial office markets.” The deal follows Hudson Pacific's acquisitions of 1455 Market St. in San Francisco’s Civic Center submarket and 222 Kearny St. in the city’s North Financial District in the last six months.

One and Two Rincon Center's 581,000 square feet comprises 482,000 square feet of office and 99,000 square feet of retail. The five-story One Rincon Center and six-story Two Rincon Center, built in 1989, are part of the mixed-use Rincon Center complex that is bounded by Mission, Howard, Spear and Steuart streets in the South Financial District.