The Central SoMa plans may still be under wraps, and the city of San Francisco may take months before the final decisions are made, but Kilroy Realty is busy wrapping up it’s massive redevelopment plans for San Francisco’s Flower Mart.
Just days before the company announces its acquisition of an additional site at the corner of 5th and Brannan Streets for approximately $31 million in cash and 867,701 Kilroy Realty, L.P. operating partnership units, Kilroy also purchased the site that was owned San Francisco-based SKS and Mitsui Fudosan, where the two firms planed to develop a 500,000 square foot office complex. This site, located at 610 Brannan Street closed on March 11, 2016 for $87.25 million, according to public documents.
The site presently features two nondescript, single story buildings that are roughly 27,000 square feet in total and were built in 1952.
The Central SoMa neighborhood is where the next development boom in the city is likely to occur. A slew of national, heavy-weight developers all have plans to redevelop sites in the neighborhood, including Tishman Speyer, Alexandria Real Estate, CIM and Boston Properties.
The impetus for this extraordinary activity is the Central SoMa Plan, which is under consideration by the San Francisco’s planning department to allow a series of rezone changes that would allow increased office density and propose new building heights in the neighborhood. The plan has not been finalized, and while the developers have floated conceptual plans, none can be realized until the city finalizes its plans.
At a special event last summer organized by San Francisco based law firm Hanson Bridgett, Brett Gladstone, one of its partners outlined all the developments under way.
“Most of the sites are already spoken for. Optioned, purchased, permitted, etc.,” said Gladstone las June as he outlined the blocks where the largest developments will likely take shape. “None of [the developers] believe that there is any risk the Central SoMa [Plan] will not get approved. It’s the question of how it’s going to get approved and what the final rules are going to be,” he added.
With this last purchase, Kilroy now owns a total of approximately seven acres on Brannan Street between 5th and 6th Streets, with the addition of the newly acquired site. The company has been working on the land assemblage for several years and completed the acquisition of the first parcel in late 2014, when it paid approximately $27 million to acquire all the outstanding shares of San Francisco Flowers Growers’ Association, a privately owned entity whose only material asset as of the closing of the proposed merger is anticipated to be a 1.9 acre land site in Central SoMa.