Tishman Speyer Properties LP plans to sell three office complexes in the San Francisco area, seeking to capitalize on demand from real estate investors amid rising rents, a person with knowledge of the matter said.
Tishman Speyer intends to offer for sale 350 Rhode Island St. in San Francisco; Dublin Corporate Center in Alameda County; and Sunnyvale Office Park in Sunnyvale, part of Silicon Valley, said the person, who asked not to be identified because the information is private. The New York-based company is seeking a combined $430 million for the properties, after paying about $295 million for them in transactions dating to 2005, according to the person.
San Francisco office rents soared 27 percent in the fourth quarter from a year earlier to an average $48.83 a square foot, propelled by rapidly expanding technology companies such as Salesforce.com Inc. and Square Inc., according to brokerage CBRE Group Inc. (CBG:US) Citywide office costs including rent, taxes and service charges jumped 36 percent last year, the biggest gain of any global office market, CBRE said in a separate report.
Commercial-property sales in San Francisco have also surged, climbing 93 percent to $6.37 billion in 2012, according to preliminary data from Real Capital Analytics Inc. Deal volume in the San Jose area, the center of Silicon Valley, advanced 38 percent to $1.85 billion, while office sales in the East Bay soared 148 percent to $959 million, data from New York-based Real Capital show.
Office sales in the San Francisco metropolitan area, including North Bay cities such as Santa Rosa, increased 81 percent to $9.35 billion, according to the research firm. It was the highest total since $21 billion of deals in 2007.
Tishman Speyer bought the Rhode Island Street offices for $42 million in 2011, and expects to sell the property for about $60 million, according to the person. The Sunnyvale center, fully leased by Juniper Networks Inc., was acquired in 2005 for $174 million, with Tishman seeking a sale price of $260 million.
The Dublin offices, where Oracle Corp. is lead tenant, is expected to bring $110 million, the person said.
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