" A steep price cut on a San Francisco building marks one of the starkest recent indicators of the city’s struggling office market. An empty 16-story building at 995 Market St. just sold for $6.5 million, a nearly 90% plunge from its 2016 price of $62 million.
The mid-Market tower at the corner of Sixth Street once housed Burning Man’s headquarters, as well as a large WeWork space. But once the co-working firm departed, the building failed to fill the gap and hasn’t been generating revenue for some time.
The site’s previous owner, Bridgeton, stopped making monthly payments on the tower last year and defaulted on its loan in December. The public auction sale, which the San Francisco Business Times first reported on, marks a stunning discount for the buyer, LNR Partners, an affiliate of Florida-based investor Starwood Property Trust. LNR had also been appointed to oversee the distressed loan.
The price drop reflects the site’s transition from a leased-out hub during during a boom-time for tech, to a space that’s sat empty while remote work has ravaged San Francisco offices overall.
“Office markets are going through what some are calling ‘The Great Reset,’” Derek Daniels, regional director of research at Colliers, told SFGATE. The market of today isn’t the market of 2016, and sales like this reflect a necessary adjustment. Buildings changing hands and resetting their values will also affect rents and lease rates across the market, he said.
“Any transactions happening right now, particularly in the mid-Market area, are a generally positive sign for San Francisco offices,” he added"
The CRE fuse is lit but they'll keep adding length to prevent calamity until after the election.
It's been burning for so Ling it's like that video of the truck barreling towards the barrier, and it never actually pays off.