JPMorgan Chase & Co.’s asset-management unit bought a San Francisco property from Jamestown LP in a $415 million deal that includes offices, a hotel and a development site, said two people with knowledge of the deal.
The purchase of 22 Fourth St. near Union Square closed today, said the people, who asked not to be named because the transaction is private. JPMorgan will acquire 430,000 square feet (40,000 square meters) in two buildings known as Pacific Place, as well as a land parcel, the people said. Tenants include the 198-room Hotel Palomar, software maker Intuit Inc. and retailers Old Navy, Levi’s and the Container Store.
Melissa Shuffield, a spokeswoman for New York-based JPMorgan, declined to comment. Jamestown, a closely held real estate investment firm based in Atlanta, confirmed the sale without naming the buyer or price in a statement today.
San Francisco’s office market is luring property investors after a surge in leasing demand led by technology companies pushed rents up 70 percent since 2010, according to Jones Lang LaSalle Inc. The metropolitan area has California’s lowest unemployment rate at 4.3 percent and an economy that has added jobs each month for almost five years, state labor data show.
“It’s a very strong market, with tons of tenant activity driving investment activity,” Grant Lammersen, a sales broker at Cushman & Wakefield Inc. with a waterfront office listing at 188 Embarcadero, said in a telephone interview.
Salesforce.com Inc. in April agreed to lease 714,000 square feet in a skyscraper being built by Boston Properties Inc. that will be the city’s tallest and named for San Francisco-based Salesforce, the biggest maker of customer-management software. A unit of Shenzhen, China-based developer Genzon Property Group Co. last month bought a majority stake in 225 Bush St. offices in the financial district, in a deal valued at $350 million.
Pacific Place, two blocks from Union Square’s cluster of upscale shops and theaters, has 202,000 square feet of offices fully leased to Mountain View, California-based Intuit’s Demandforce unit and 200 feet (61 meters) of retail frontage on Market Street, Jamestown said. The area is the main transit corridor for city buses and Bay Area Rapid Transit, or BART, the regional subway and rail system.
“The addition of a signature tenant like Intuit and its long-term lease created an attractive investment for a buyer,” Jamestown Chief Operating Officer Michael Phillips said in the statement. “We remain committed to the San Francisco Bay Area as we are very engaged in the community through our other local properties.”
JPMorgan buys properties on behalf of institutional investors through its Global Real Assets business. The unit, run by Joe Azelby, invests and manages in real estate, infrastructure and maritime assets around the world.
Eastdil Secured LLC was the listing broker for Jamestown.