- Hines To Assume Property Management and Leasing Responsabilities
Hines, the international real estate firm, and Invesco Real Estate, announced hat they have jointly acquired the Rialto Building located at 116 New Montgomery Street in San Francisco's South Financial District, from Africa Israel USA (AFI USA). Financials on the transaction were not disclosed. Hines will oversee management and leasing of the property on behalf of the partnership.
Originally built in 1902, the H-shaped Renaissance-style building was designed by Meyer & O'Brien Architects. The nine-story building contains 135,486 square feet of office and retail space. After the great earthquake of 1906, the building's interiors were completely rebuilt, leaving the steel, brick and concrete exterior structure intact. AFI USA acquired the building in 2007, and soon after, undertook a capital investment program to restore the property to its original grandeur. Restoration work focused on original architectural components in the main lobby, including the bronze staircase, ornate metal elevator doors, the painted panel ceiling and the marble flooring.
Hines Senior Managing Director, Cameron Falconer, commented, "The Rialto Building is one of San Francisco's true architectural icons, and we are pleased to add it to our portfolio. Going forward, Hines and Invesco will continue to invest in the building to complete its transition to a 'creative core' asset that caters to San Francisco's burgeoning technology and multimedia industry tenants."
The Rialto Building is currently 85 percent leased to strong tenant roster including office tenants Trulia, Nelson\Nygaard and LaunchSquad, and retail tenants Walgreens and Chipotle.
"This sale proves that San Francisco is still unmatched as the nation's top-performing office market," said Tamir Kazaz, CEO of AFI USA. "The combination of historic architecture, creative layouts and central location make this a highly attractive property, one that will ensure long-term value and stable cash flows."
Established in 1983, Invesco Real Estate manages $49.9 billion of real estate investments, which includes $29.8 billion in direct real estate portfolios and $20.1 billion in real estate securities (as of December 31, 2012). Invesco Real Estate has more than 340 employees in 17 offices through the U.S., Europe and Asia. The group focuses on top-down market and property type fundamentals combined with bottom-up local market intelligence. Senior members of the management team have worked together for 24 years, contributing to the consistent implementation of Invesco's investment strategy.
Hines entered the California market in San Francisco in 1979. Among the firm's most recognizable owned, developed or managed projectsthere are 101 California, the JPMorgan Chase Building at 560 Mission, 580 California, 50 Fremont and the recently acquired 550 Terry Francois building. Currently, the firm owns and manages 3.6 million square feet in San Francisco.
Hines is a privately owned real estate firm involved in real estate investment, development and property management worldwide. The firm's historical and current portfolio of projects that are underway, completed, acquired and managed includes 1,208 properties representing more than 488 million square feet of office, residential, mixed-use, industrial, hotel, medical and sports facilities, as well as large, master-planned communities and land developments. Currently, Hines manages 379 properties totaling 137 million square feet, which includes 66 million square feet for third parties. With offices in 104 cities in 18 countries, and controlled assets valued at approximately $23.8 billion, Hines is one of the largest real estate organizations in the world. Hines is also a world leader in sustainable real estate strategies, with extensive experience in LEED®, ENERGY STAR®, BREEAM, Haute Qualité Environnementale and DGNB green building rating systems.