Columbia Property Hoping to Offload 201 California

Columbia Property Trust is looking for a buyer in San Francisco after a nearly $2 billion loan default tied to an office building.

The New York-based firm has put up for sale 201 California Street in the Financial District, the San Francisco Business Times reported. Columbia is looking to offload the 273,333-square-foot building after it defaulted on a $1.7 billion mortgage tied to that building and six others in 2023.

Though the asking price for the 17-story building is unclear, it could fetch around $250 per square foot, equating to a price in the upper $60 million range, a source familiar with the building told the Business Times. Columbia acquired 201 California Street from Beacon Capital Partners in 2019 for $239 million, or around $875 per square foot. The appraised value of 201 California Street reportedly fell to $81.5 million early this year from $218 million in 2021.

Whether or not the other buildings tied to the mortgage are listed for sale remains to be seen. The group includes one other building in San Francisco a few blocks west at 650 California; three buildings in Manhattan; one in Jersey City, New Jersey; and one in Boston.

The appraised value of the seven-building portfolio fell 45 percent to $1.2 billion from nearly $2.3 billion between 2021 and 2025, per CMBS data cited by the Business Times.

Columbia worked out a deal with lenders Goldman Sachs, CitiBank and Deutsche Bank to extend the loan’s maturity to July 2025 with the option for Columbia to extend it for six months. It’s unclear whether Columbia has exercised the six-month extension option or if the $1.7 billion loan will mature this month.

The building at 201 California Street is only 35 percent leased, according to the Business Times.

San Francisco’s office vacancy rate sat at 34.8 percent last quarter, according to CBRE. The city is no longer in last place when it comes to return-to-office mandates, however, and the influx of artificial intelligence companies over the coming years could slash office vacancies across the Bay Area.

— Chris Malone Méndez