ASB Real Estate to List SF office building at Discount

ASB Real Estate Investments is poised to sell an 187,000-square-foot office building in San Francisco at the discount price of about $50 million.

The Washington, D.C.-based investor is expected to list the six-story building at 795 Folsom Street in coming weeks, the San Francisco Business Times reported, citing unidentified sources.

The building could hit the market with pricing guidance of around $275 per square foot, or $52.4 million.

ASB bought the fully leased property in 2013 for $109.6 million, or $586 per square foot, according to the Business Times.

At the time, ASB CEO Robert Bellinger said the building was “well-positioned to benefit from San Francisco’s strong economy” at its location in South of Market.

The white offices with green and blue trim served as the headquarters for Twitter from 2009 to 2012.

Under ASB, the building secured tenants such as adtech Quantcast and Nginx, a web server software developer acquired in 2019 by F5 Networks. It now has nearly 127,000 square feet of offices available for lease, according to online listings.

The empty offices suggest its occupancy has dropped to 33 percent.

Quantcast, which took 95,000 square feet of space in the building in 2016, renewed its lease in the third quarter last year, but shrank its footprint by about a third, according to the Business Times.

In 2019, ASB refinanced 795 Folsom with a $100 million loan from Capital One. That loan, which had an interest rate of less than 3.5 percent, will mature this year.

Brokers Ryan Venezia and Seth Siegel at Cushman & Wakefield hold the listing.

The San Francisco office market has been hard hit during a broad shift to remote work, with vacancy at a record 35.9 percent, according to CBRE.

A few buildings have sold at major discounts, resetting prices between $200 and $300 per square foot — which has interested a broader pool of prospective buyers, said Alexander Quinn, senior director of Northern California research at JLL.

Barings is looking to sell a 20-story office tower in San Francisco’s Yerba Buena for $80 million, or 46 percent less than it sold for nearly a decade ago. In January, the North Carolina-based investor listed the 240,000-square-foot building at 33 New Montgomery Street.

— Dana Bartholomew