San Francisco’s 50-year-old Transamerica Pyramid will get a $250 million update from owner Michael Shvo, marking a big bet on the city’s pandemic-ravaged office market.
Shvo’s eponymous firm hired London’s Foster + Partners to design renovations on the 48-story tower at 600 Montgomery St., the San Francisco Business Times reported. The project includes an additional $150 million expansion of 3 Transamerica, at 545 Sansome Street, that would almost double its 50,000 square feet, the renovation of a building at 505 Sansome Street and an upgrade to the Transamerica Redwood Park.
The investment is among the largest votes of confidence in the post-Covid era for the city’s downtown office market, where vacancies surged to 19.9 percent in the fourth quarter. Salesforce shrank its footprint in its own building and workers are trickling back to work in San Francisco more slowly than in Los Angeles and Austin as companies adjust to the reality that a full five-day workweek may be gone for good.
“If you make their office experience as good as if not better than their residential experience, their home experience, you’re giving companies another tool to bring employees back to work,” Shvo told the Business Times.
Completed 50 years ago, the Transamerica Pyramid was San Francisco’s tallest building until the Salesforce Tower was finished in 2018. Shvo’s firm bought it in October 2020 for $650 million with Deutsche Finance America and European investors.
Fencing will be going up this week. The project includes a redone Mark Twain Street that would enliven restaurants and other retail options as visitors walk under cherry blossom trees on the street that leads to the tower. Landscape improvements will also be coming to all the buildings and the park.
The tower’s renovations are expected to last a year and would be followed by renovations at 545 Sansome Street, the San Francisco Chronicle reported.
[San Francisco Business Times] — Gabriel Poblete
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