The 955 Market Street building that was once home to Burning Man headquarters, and then a whole bunch of WeWork offices, is now empty and just sold for a measly 10% of the price it fetched in 2016.
Let’s look back to the days of 2016, when the 16-story office building at 995 Market Street was on the market for sale, drawing the San Francisco Business Times headline “WeWork’s Mid-Market landlords prepare to cash in.” The Burning Man office headquarters called Black Rock LLC had once been a tenant, as was the Eviction Defense Collaborative, but WeWork had pretty much taken over the whole building. And the place ended up selling for $62 million in 2016, with marketing materials from 2015 (seen below) calling it “San Francisco's most sought after and dynamic submarket.”
Yeah, about that “most sought after” part. Eight years later, that now-empty building just sold for a mere $6.5 million in an auction proceeding last week, according to the SF Business Times. Yes, that is nearly a 90% haircut on that 2016 price.
It was back last December when the building’s owner Bridgeton Holdings went into default on their $45 million loan on the 90,000 square-foot office building. The Business Times reports that Florida-based LNR Partners was the fire-sale price buyer, and that LNR Partners has been the “special servicer” on that loan. So this was likely them foreclosing on the place, which one would imagine they’ll just resell if and when the real estate market comes back a bit.
As for Bridgeton Holdings, they’re not going under. The Chronicle reports in their piece about the sale of 995 Market that Bridgeton had just partnered to buy up the former home of Eventbrite at 410 Townsend Street, also at a massive 75% discount over its previous sale price.
Given the remarkable discount, some will wonder why the City of San Francisco didn’t just scoop it up. But given that they buyer LNR Partners effectively auctioned it to themselves, it's not certain that low $6.5 million price would have been available to other buyers.
And the city has been making aggressive moves to buy downtown properties lately. They bought the former Zendesk headquarters one block away last August, and their lease deal with an option to buy at the former Uber headquarters was just passed by the SF Board of Supervisors Tuesday afternoon.
Related: City Buys Former Zendesk HQ On Market Street, Will Make It ‘Mental Health Service Center’ [SFist]
Image: Google Street View