Jamestown dodged one bullet, then another, relating to a historic retail-office building in San Francisco’s South of Market, across from Union Square.
The Atlanta-based investor sold the 93,000-square-foot building at 731 Market Street
for $15 million — almost two years after failing to pay back a $32.5 million loan tied to the property, the San Francisco Business Times reported, citing an unidentified source.
The buyer was New York-based Seven Equity Group in a deal that closed late last year for $160 per square foot. JLL represented Jamestown in the sale.
It could have turned out differently.
In July 2023, Capital One served Jamestown with a notice of default for the loan, alleging the firm failed to repay close to $25.5 million of that debt when the loan matured the previous April.
But Capital One and Jamestown cut a deal in October to retire Jamestown’s debt on 731 Market but keep the building, allowing for its eventual sale. Terms of the deal were not disclosed.
Jamestown bought the now 117-year-old building in 2015 for $65.5 million, or $700 per square foot.
The company had tried to sell the building before its loan challenges rose last fall, according to the Business Times. It got a nibble from San Francisco-based TMG Group in the upper $100 per square foot range, but the deal fizzled after being held up by complications from Jamestown’s delinquent loan on the property.
Seven Equity Managing Principal Ray Falack declined to comment on plans for the vacant five-story building. A ground-floor storefront is leased to CVS, though the drugstore closed in 2021.
The company, which focuses on distressed properties, owns an 86,000-square-foot office building at 420 Taylor Street, which serves as the headquarters for Nextdoor.
Jamestown still owns Ghirardelli Square and Levi’s Plaza. It also owns the 135,500-square-foot, 123-year-old Rialto Building at 116 New Montgomery Street — a year after a $60.6 million loan secured by the building came due.
In February, its lender sold a $22.2 million loan backed by 660 Market Street, a 40,000-square-foot building Jamestown bought in 2018, to Fortress Investment Group, according to the Business Times. Fortress then sold the loan to San Francisco-based Long Market Property Partners, which took control of the building in June.
— Dana Bartholomew
Read more
Jamestown cuts deal with Capital One to keep SF office building
TMG faces roadblock in purchase of office building in SF’s SoMa
Fortress Investment acquires $22M loan linked to SF office building
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