Zurich Buys Grosvenor-Owned Jackson Square Offices

Zurich Alternative Asset Management purchased a Jackson Square office building in San Francisco as it continues an acquisitions streak across the country.

The New York-based arm of Swiss insurer Zurich acquired the 54,700-square-foot property at 394 Pacific Avenue from Grosvenor Americas for $32.8 million, the San Francisco Business Times reported. The price pencils out to roughly $600 per square foot.

The deal fits squarely into Zurich’s recent playbook. Over the past year, the firm has been assembling a portfolio of boutique office properties in submarkets like Denver’s Cherry Creek, Chicago’s Fulton Market and Cambridge, Massachusetts. The Jackson Square building aligns with those types of properties.

“We’re starting to see more and more value in the office space,” Sean Bannon, Zurich’s head of U.S. real estate, told CoStar in December. “The last three deals that we’ve done have been in the office space, where you can buy in really good micromarkets. There are winning nodes and losing nodes within cities.”

Grosvenor paid $32.3 million for the building in 2016. The London-based investor has been offloading San Francisco assets as it shifts toward deploying capital through joint ventures rather than direct ownership, a company spokesperson said Monday.

Zurich’s plans for the five-story, 1907-built property have not been disclosed. The building previously housed tenants such as Anthropic and Iconiq Capital, though neither maintains a presence there today. The building was fully occupied when Grosvenor purchased it a decade ago, though its current occupancy is not clear.

When San Francisco began emerging from pandemic doldrums, Jackson Square became a promising neighborhood for investors to plant their money. Former Apple design chief Jony Ive has been buying up property in the area. And earlier this spring, Shvo sold the Transamerica Pyramid for $691.6 million. As the artificial intelligence boom gobbles up office space across the Bay Area, Jackson Square has become a favorite neighborhood among some firms.

— Chris Malone Méndez