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SAN FRANCISCO-American Assets of San Diego has acquired the 393,000-sf Landmark at One Market Street here and the leasehold for the 44,000-sf annex building for about $500 per sf, according to industry sources familiar with the transaction. TMG Partners sold the Landmark and EOP sold the leasehold. The price reflects the over-market rents being paid by tenants as much as the prominence of the fully leased building, its recent renovation and the white-hot investment market, according to the sources.Designed by the world-renowned architect firm Bliss and Falville, the 11-story Landmark at One Market Street is located at the foot of Market Street, adjacent to the Federal Reserve, Embarcadero Center and the historic Ferry Building. It enjoys panoramic views of San Francisco Bay as well as views up both California and Market Streets. It was built in 1916 in as the headquarters for the Southern Pacific Railroad. The company occupied the building until 1998.On-site amenities include the adjoining grand lobby at One Market Plaza, operable windows, and private roof-deck patios on the 7th and 11th floors. The property houses the three-star One Market Restaurant, a full-service Bank of America, a Federal Express service center, cleaners, retail shops, and a food court, including Starbucks and Jamba Juice. The sale by TMG Partners comes after a $175-million rehab that among other things included all new building systems and a complete seismic retrofit, local industry sources tell GlobeSt.com. TMG then proceeded to ink long term leases with brand-name tenants like Salesforce.com (132,973 sf), Del Monte (104,729 sf), and Microsoft (45,795 sf) at year 2000 lease rates. American Assets’ portfolio encompasses approximately 3.7 million sf of retail, 2.2 million sf of office and over 1,000 residential apartment units throughout California, Arizona, Nevada, Texas and Hawaii. American Assets declined comment for this story beyond its prepared statements. A TMG representative was unavailable Monday for comment.”These types of superlative assets are not for sale very often,” says the company’s chief executive John Chamberlain in a prepared statement. “We are extremely pleased to be in the position to acquire this asset and continue our expansion into (the San Francisco market).Earlier this month, American Assets made its first San Francisco acquisition, paying about $411 per sf ($69 million) for 160 King St., a 168,000-sf class A office building across from SBC Park that was completed in 2002. The South of Market property totals nine stories above ground and one below. Five floors contain office space and five stories contain parking. Major tenants in the building include the law firm of Gray Cary and Brown & Toland Medical Group. Tenants representing about 70% of the building are on leases that extend through 2010. The seller was ROK Properties, which includes Rosenberg Ventures.”The San Francisco market is very appealing to American Assets,” Chamberlain told GlobeSt.com at the time of the sale. “San Francisco remains a preeminent financial and commercial center and the Bay Area’s recovery has been strong over the past 24 months, and is expected to tighten through 2005.”

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