Home of SF’s first “sobering center” sells for $17.5M

Seller spends $9M to rehab office building for city lease

Vantage Property Investors' Edward Fox with 1076 Howard Street (Vantage Property Investors, LoopNet)
Vantage Property Investors' Edward Fox with 1076 Howard Street (Vantage Property Investors, LoopNet)

Vantage Property Investors has sold the site of San Francisco’s first “drug sobering center” for just over $17.5 million, or nearly $1 million less than its asking price.

The buyer is a trio of LLCs: Sveiks Holdings, Weiglein Properties and Glade Barne Holdings, according to public records. The same three LLCs sold a 93,000-square-foot warehouse property in Fremont to Fortress Investments for $29 million in June.

Vantage invested more than $9 million for renovations at the 17,000-square-foot former office building at 1076 Howard in SoMa, which the Manhattan Beach-based commercial developer bought for $5 million in the fall of 2015, according to public records.

The property came to market earlier this year with an asking price of $18.5 million. Marketing materials from brokerage Newmark touted the extensive structural work, new mezzanine level, upgraded building systems, new elevator, restrooms and kitchen. The listing notes also played up the 8.5-year lease of the entire property to the city, at a time when B-class office space such as 1076 Howard was having an increasingly difficult time attracting commercial tenants. Newmark listing agent Mark Geisreiter did not reply to requests for comment on the sale, which closed July 18.

The sales price works out to about $1,000 per square foot.

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The sobering center, dubbed SoMa Rise, opened its doors in June and has space for about 12 people at a time to rest, shower, eat snacks and get connected with treatment services, ideally in less than 12 hours, according to the SoMa Rise website. It will ramp up to 24-7 service, and the pilot program could lead to similar centers in other parts of the city.

San Francisco Mayor London Breed first announced the lease in April 2021 and it took more than a year to build out and staff. Of the $9 million renovation, nearly $1 million went to tenant improvements specifically for the sobering site, according to the marketing materials, including open-plan office space on the second floor and exam and consultations rooms on the ground floor. The city put in nearly $2 million to further customize the former office to its new use.

“This location will provide a safe place for our Street Crisis Response Team and other outreach efforts to bring people who are using drugs and should not be left to themselves,” Breed said in a statement announcing the lease. “It’s a way we can intervene, address the immediate issue and then also get them connected to the longer-term services and support they need.”

The sobering site was originally supposed to be in a parking lot in the Tenderloin, the nearby neighborhood north of Market Street where Breed declared a state of emergency late last year due in part to rampant drug use and sales, though that declaration ended in March. The parking lot site was converted to a safe sleeping site during the pandemic instead and is slated to be turned into 70 low-income rentals owned by the city and leased and run by a nonprofit.

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