An investment vehicle managed by Beacon Capital Partners has completed its $275 million acquisition of Rincon Center, a mixed-use complex in San Francisco.
The Boston investment manager's Beacon Capital Strategic Partners IV purchased the property from a venture of Glenborough Realty Trust and Blackstone Real Estate Partners II. Beacon Capital IV is a $2 billion investment vehicle that has already made, or committed to making nine acquisitions.
Rincon Center contains 528,000 square feet of office and retail space and 320 apartment units, which could be converted to condominiums. The Glenborough/Blackstone team, which was advised on the sale by Eastdil Secured, acquired the property in 1999 through a foreclosure.
The property was constructed on a full city block bounded by Mission, Howard, Spear and Steuart Streets, in the late-1980s by Perini Group and Pacific Gateway. It consists of a five-story office building at 101 Spear St. and two 22-story buildings, which house additional office space and the property's residential component, at 121 Spear Street and 88 Howard Street. The property's retail component totals roughly 64,000 sf.
The Glenborough/Blackstone team had previously tried selling the property, but offers didn't meet their expectations. That was before Pacific Bell Directory, the property's largest tenant, renewed its lease through 2013.
Glenborough said it generated $9.5 million in gains from the sale, which provided it and its partner with a 20 percent internal rate of return.
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