Transamerica Pyramid Sells for $700 Million

Since news broke last week that Germany’s largest public pension fund and its partner, Michael Shvo, had contracted to sell San Francisco’s Transamerica Pyramid to a Cyprus-based investment firm, numbers have bounced around commercial real estate circles.

Now, Green Street News has reported that buyer Yoda PLC has agreed to purchase one of the country’s most iconic skyscrapers for “roughly $700 million.” This would put the transaction as the priciest office sale in San Francisco since 2021. However, the number would mean a significant loss for the German pension fund, Bayerische Versorgungskammer (BVK) and its partners, Munich-based private equity firm Deutsche Finance Group, and Shvo.

The group bought the Transamerica Pyramid from Dutch insurance company Aegon in 2020 for $650 million. It then took out a $400 million loan from Aegon to finance a full-scale makeover that raised the property from a crumbling monument of a bygone era into one of the city’s most exclusive and sought-after office leases. Shvo brought in starchitect Norman Foster to lead the renovation, which added a public cafe, exhibition space and urban pocket park on the ground floor.

The relationship between BVK, Deutsche Finance and Shvo began to crumble in recent years. The group partnered on its first real estate deal in 2018, around the same time Shvo had pleaded guilty to tax evasion charges. The group teamed up on a $3 billion spending spree that included Chicago’s Big Red skyscraper, the Coca-Cola building in Manhattan and Miami’s Raleigh Hotel.

BVK recently warned that total losses on those deals reach near $1 billion. Rumors around the breakup between Shvo and his German partners had been swirling for the better part of a year and came to a head last month when multiple outlets reported that the Germans were trying to force Shvo out of the Transamerica Pyramid. Shvo initially rejected the rumors.

Representatives for Yoda PLC, BVK, Deutsche Finance Group and Shvo did not return multiple requests for comment. One local developer pushed back on Green Street’s report, saying he heard the Transamerica Pyramid was set to go for around $1 billion.

Nevertheless, at $700 million, the sale trounces this year’s previous Bay Area high — DivcoWest’s $450 million buy-in at the 48-story office tower at 101 California St.

– Christopher Neely