Sources: Prado Group buys shuttered medical center for $50M

Prado Group has reportedly paid more than $50 million to buy the former California Pacific Medical Center campus in Presidio Heights, with approvals to build hundreds of homes.

The San Francisco-based developer bought the shuttered hospital at 3700 California Street, the San Francisco Business Times reported.

The seller was Sacramento-based Sutter Health, which two years ago won approval to replace the 5-acre campus with 273 apartments and homes.

Dan Safier, CEO of Prado Group, didn’t disclose the selling price. Unidentified sources told the Business Times the developer paid just over $50 million.

Brokers Mike Taquino and Kyle Kovac of CBRE’s Capital Markets represented Sutter Health. It’s not clear who represented the buyer.

Hospitals operating at 3700 California go back to 1887, with the current six closed campus buildings dating from 1938.

Sutter Health moved into a newly built, seismically updated campus at 1101 Van Ness Street on Cathedral Hill in 2019. The $2.1 billion CPMC Van Ness Campus has 274 beds.

TMG Partners, a developer based in the Financial District, worked with Robert A.M. Stern Architects to entitle the former hospital site in Presidio Heights for redevelopment into 273 residential units, spread across 19 apartment buildings and 14 single-family homes, an effort that took five years.

To make way for the new homes, five of the hospital’s six buildings and a two-level parking garage would be demolished.

Prado Group has met with the Planning Department to discuss the possibility of adding density to the project, unidentified sources told the newspaper. The developer has filed a request with the city to extend the project’s current entitlements, Safier said.

“Rare sites like this in extraordinary, high-value neighborhoods come up infrequently, especially in San Francisco’s Pacific and Presidio Heights neighborhoods,” Safier told the Business Times. “The city and state are also very focused on doing what is necessary to bring large, high-quality infill housing projects like this to fruition in order to reduce our perpetual housing shortage.”

In 2019, Prado Group won approval to redevelop the nearby University of California — San Francisco campus at 3333 California Street, with 744 homes, 35,000 square feet of shops and restaurants, a child care center and 5 acres of open space.

Last year, Prado Group announced it had raised $200 million toward a new fund to target multifamily and retail investments. In the two years leading up to the pandemic, it sold off more than 50 buildings of its real estate portfolio.

In September, the firm paid $26 million for a 114-year-old building in San Francisco’s Union Square leased by Giorgio Armani.
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— Dana Bartholomew

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