SAN FRANCISCO--(BUSINESS WIRE)--Columbia Property Trust, Inc. (NYSE: CXP) announced that it has successfully executed its plan to create value at 650 California Street by revitalizing and re-leasing the property, with 315,736 square feet leased at the building since acquisition.
When Columbia purchased the iconic 478,000-square-foot office building in San Francisco’s Financial District in September 2014, 650 California Street was 88 percent leased, with over a third of the leases scheduled to expire within two years. Since that time, the company has leased or renewed two-thirds of the space at the building and curated a diverse roster of high-quality, small to mid-sized tenants. The building now stands at 96 percent leased overall, with an average remaining lease term of 6.6 years.
Recent leases include an 86,225-square-foot lease with financial technology company Affirm, signed in April 2017 and scheduled to commence this quarter, and a new 60,576-square-foot lease with co-working giant WeWork that was signed in February of 2017 and commenced in July. Together, these two leases rolled cash rents up by 172 percent on the leased space. Recently, several smaller leases have brought 650 California to 96 percent leased, and other ongoing lease negotiations have the potential to drive the building’s occupancy to 100 percent within the next few months.
The 33-story tower has been a landmark of the San Francisco skyline since its construction in 1964 and recently earned the #2 spot on Architectural Digest’s list of the world’s most “Breathtaking Office Views.” Since acquisition, Columbia has completed a series of renovations to modernize the tower and drive tenant demand, including adding collaborative spaces and a new café to the main lobby, new state-of-the-art fitness and conference centers, and a luxury concierge service, exclusively for tenants.
“Shortly after acquisition, we began taking steps to reposition 650 California Street by upgrading the building’s lobby and amenities to complement its world-class views and off-set center core, which appeal to traditional and creative tenants alike,” said David Dowdney, senior vice president and head of leasing at Columbia.
Columbia’s success with 650 California Street is emblematic of the company’s San Francisco portfolio and repeats the pattern it established three years ago with its earlier acquisition in the city, 221 Main Street. At that building, Columbia leased 187,000 square feet between April 2014 and March 2015 that took it from 83 percent to 94 percent leased.
Nelson Mills, Columbia’s president and CEO, commented, “Our team has created substantial value in our Bay Area portfolio by working diligently and creatively to capitalize on the central locations and unique attributes of each property, with first-class amenities tailored to meet the needs of our tenants. As a result, we have almost zero vacancy across our two million square feet of office space in the area, leased at strong rates, and we are confident in our ability to build on this record of success as we seek to expand our footprint in the market.”
Columbia engaged Cushman and Wakefield’s San Francisco leasing team, which includes J.D. Lumpkin, Zach Siegel and Sam Wasserstein, to assist with the leasing efforts at 650 California.
About Columbia Property Trust
Columbia Property Trust (NYSE: CXP) owns and operates Class-A office buildings concentrated in New York, San Francisco, and Washington, D.C. Its portfolio includes 20 properties with over nine million square feet. Columbia carries an investment-grade rating from both Moody’s and Standard & Poor’s. For more information, please visit www.columbia.reit.
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