Boston Properties Inc., the biggest U.S. office real estate investment trust by stock-market value, completed the purchase of a San Francisco development site for about $71 million in cash as rents rise in the area.
The project at 535 Mission St. will be a 27-story tower with about 307,000 square feet (28,500 square meters) of rentable office and retail space in San Francisco’s South of Market district, the Boston-based REIT said today in a statement. The price includes work already done and materials purchased, with the total cost of the building budgeted at about $215 million and completion planned for late next year.
San Francisco office rents jumped 27 percent in the fourth quarter from a year earlier, broker CBRE Group Inc. said last month. Citywide office costs -- including rent, taxes and service charges -- soared 36 percent, the biggest gain of any global office market, CBRE said in a December report.
Boston Properties also said today that it agreed to pay about $27 million for a parcel at Reston Town Center in Virginia that’s zoned for 250,000 square feet of offices. The REIT is evaluating a mixed-use plan for the site that could include residences, according to the statement.
The announcements were made after the close of regular U.S. trading. Boston Properties rose 0.2 percent to $104.23 today in New York. The shares have fallen 1.5 percent this year.