Blackstone buys San Francisco office from CIM

CIM Group sold the building for over $200m more than its purchase price.

Blackstone has purchased a San Francisco office tower from CIM Group, PERE has learned.

Blackstone declined to comment, but a source with knowledge of the deal said the New York-based alternatives investor paid $313 million for the 17-story building, located at 212 Main Street.

Los Angeles-based CIM bought the 372,000 foot building in December 2009 for $112.2 million, according to data provider Real Capital Analytics. The firm could not be reached for comment.

The building is the headquarters for bank and brokerage firm Charles Schwab, which renewed its lease in December for 10 years. It was unclear at press time out of which funds capital for either private equity firm’s purchase originated.

The deal comes as San Francisco office values have continued to climb. Price per square foot of San Francisco central business district offices hit an all-time high in the fourth quarter of 2016, at $784 per foot, compared with $736 per square foot in Q4 of 2015, according to RCA.

Blackstone has invested in the San Francisco area since 2007, according to RCA. The firm’s most recent publicly-disclosed transaction was the December purchase of Lakeshore Plaza, a five-building retail center, for $125.4 million.

Blackstone managed $101.9 billion in real estate as of December 31, according to its fourth-quarter earnings report. Its flagship global opportunistic fund, BREP VIII, had a 17 percent net internal rate of return, while its core-plus platform, Blackstone Property Partners, generated a 13 percent net IRR.

CIM manages about $19.2 billion in real estate assets, according to its website.