San Francisco’s Transamerica Center Inks New Leases

San Francisco’s Transamerica Pyramid Center is filling back up after its high-profile sale earlier this year.

Since acquiring the city’s most recognizable office tower and the surrounding complex in March for a combined $725 million, its new owner, Cyprus-based investment firm Yoda PLC, has inked seven leases totaling about 113,000 square feet, the San Francisco Chronicle reported.

Two of the deals were in the works before the sale, while the remaining five were initiated and closed under Yoda’s ownership. The deals include tenants in the legal, finance and tech sectors, as well as a flexible workspace operator that sources told the Chronicle has taken space at Two Transamerica, the 20-story office building at 505 Sansome Street. The tenants’ identities were not disclosed.

Previous owner Michael Shvo pursued a repositioning effort at the office tower, restoring its lobby and public plaza, reviving Transamerica Redwood Park and bringing in restaurants to make the property into a mixed-use destination. Before stepping away from management earlier this year, Shvo said the complex was roughly 85 percent leased as of December.

Yoda is looking to continue work on the Transamerica complex. The company plans to invest further in Two Transamerica with 10 move-in-ready spec suites, a full-floor amenity center and other workplace upgrades intended to attract companies seeking premium, flexible office space. Additional improvements are also planned for the five-story Three Transamerica building at 545 Sansome Street, where ground-floor restaurant spaces vacated after the sale are expected to be repositioned.

The leasing and repositioning activity speaks to the continued flight to quality in San Francisco’s office market. While vacancy remains elevated across the city, trophy buildings with upgraded amenities continue to outperform, particularly among artificial intelligence firms and other fast-growing tenants looking for turnkey space.

“We’re consistently hearing from AI- and growth-oriented companies that speed-to-occupancy is a top priority,” Chris Roeder, a vice chairman at JLL, which brokered the recent lease deals, told the Chronicle.

Office vacancy in San Francisco fell to roughly 29.7 percent in the second quarter, down from 34.7 percent a year earlier, according to CBRE’s second quarter report.

— Chris Malone Méndez