Long Market buys office/lab building in Downtown SF for $17.6M

Long Market Property Partners has forged ahead where few investors now dare to tread with the purchase of an office building in Downtown San Francisco.

The San Francisco-based real estate firm paid $17.6 million for a 48,500-square-foot building at 40 Jessie Street, in the Financial District, the San Francisco Business Times reported. The seller was Golden Gate University.

The price for the offices came out to $362 per square foot.

The building, which sits in an alley behind the university’s Mission Street campus, once housed its Student Services Center. It was listed last fall.

Long Market described the recently renovated and fully leased property as a “research and development office building in the heart of San Francisco’s Transbay neighborhood.” 

“We are excited to invest in a building that offers this unique combination of laboratory and office space in a prime downtown San Francisco location,” Justin Shapiro, a principal at Long Market, said in a statement. 

Its improvements are “well-suited to the current climate in San Francisco, where older office inventory is being re-imagined for more modern tenant uses,” Shapiro said. “We believe that this building is unique within downtown San Francisco and will be a formula others will follow in the coming years as older office assets are repurposed.”

Golden Gate University had listed the building in September along with its 210,000-square-foot campus at 536 Mission Street, which it has owned since 1964, according to the Business Times. Both buildings are within a block of Salesforce Tower.

Eastdil Secured is handling the property listings for the university. It’s not clear what the status is on the second sale.

Golden Gate President David Fike told the Business Times it was selling its college campus buildings because of a shift to hybrid and remote learning. He said the 170-year-old private university would stay in San Francisco. 

The university, which traces its roots to evening lectures at the San Francisco YMCA during the California Gold Rush in the 1850s, offers undergraduate and graduate degrees in professional careers such as accounting, taxation, law and business. 

In the era of remote work and tech layoffs, one in three offices in the city are now vacant – with a glut of subleases flooding the office market. San Francisco this year faces a wave of office defaults, experts say, because of soaring vacancy rates, higher interest rates and a drop in value of older buildings. 

— Dana Bartholomew

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