Ballast Buys Two Rent-Controlled Buildings in San Francisco for $26M

Ballast Investments snapped up a pair of rent-controlled multifamily buildings in Nob Hill for $25.9 million from longtime owner the Lee family, The Real Deal has learned.

The San Francisco-based landlord bought the 42-unit property at 1425 Taylor Street for $14.3 million, or $340,476 per unit, and the smaller 32-unit building at 1900 Washington Street for $11.6 million, or $362,344 per unit, according to property records filed June 27.

The deal values the properties a notch below the average multifamily sale price per unit in the Bay Area of $362,621 in the first quarter of 2025, according to a report by Kidder Mathews.

Ryan Brewer, Ballast’s co-founder and managing principal, signed off on a $65 million loan tied to the two properties from Comercia Bank, property records show. Spokespeople for Ballast and Comercia did not respond to requests for comment.

Michael Lee, the manager of a family trust that has owned the properties for multiple generations, could not be reached for comment.

Compass Commercial’s Mark Bonn, who arranged the deal for both sides along with Mirella Webb, said the two-building portfolio sold for more than its asking price after receiving offers from 10 prospective buyers.

“It speaks to the quality of the real estate,” Bonn told TRD. “I haven’t heard of any deals of this size happening recently where the seller received 10 offers. It was a really great outcome.”

The price might have been higher if it weren’t for a new local ordinance that’s forcing landlords to make seismic retrofits in San Francisco this year, Bonn and Webb said.

“The fact that these properties transacted despite the looming retrofit obligations highlights buyer confidence in long-term San Francisco real estate fundamentals,” Webb said in an email.

The pair of six-story rent-controlled buildings are located seven blocks apart in the city’s Nob Hill neighborhood. About half of the tenants have moved in recently and pay close to market-rate rent, according to Bonn and Webb. The average rent per square foot is $3.18 at 1425 Taylor Street, while 1900 Washington Street is bringing in an average rent of $3.15 per square foot.