555 Mission Street | Properties | Tishman Speyer

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555 Mission Street demonstrates Tishman Speyer’s ability to sustain the value of our investments while maintaining our commitment to the environment.

555 Mission Street
San Francisco 94105
California

A deeper look at : 555 Mission Street

As seasoned experts in global real estate, Tishman Speyer developed 555 Mission Street and leased 88% of available space in the midst of challenging economic conditions.

The Property

In 1999, Tishman Speyer acquired land at 555 Mission Street, a prime location in the south financial district of San Francisco. The strategy was to control one of the city’s most attractive large office development sites, with the goal of constructing a premier Class A property as market conditions permitted.

Our Role

555 Mission Street was slated to be a 33-story Class A office building totaling 556,319 square feet. Construction began in September 2006 and concluded on schedule in December 2008.

In 2006, at the time of predevelopment activities, Tishman Speyer sold a minority joint-venture interest in the project to a third-party investor. This move captured a portion of substantial appreciation in land value.

At the time of its completion, the asset entered the market 31% pre-leased, coincident with the peak of the financial crisis. In this very challenging environment, our leasing team aggressively pursued all credit—worthy tenants seeking space in the San Francisco area. By the end of September 2009, the team had completed 119,960 square feet of new leasing, bringing the asset to 52% leased. These leases helped our team to negotiate a four-year extension of the maturing construction loan, in addition to increased liquidity and a one-year option if the loan was repaid earlier. At the same time, Tishman Speyer and our joint-venture partner contributed a combined $30 million in new equity, 50% of which was generated by the release of escrows tied to the real estate agreement. This overall recapitalization provided sufficient funding to pursue the leasing program and bring the property to stabilization.

Over the ensuing year, Tishman Speyer continued to generate significant new leasing activity, closing on three leases totaling 193,588 square feet. Among these was a 181,930-square-foot lease to Deloitte LLP in the fall of 2010. This transaction represented the first relocation of a tenant of over 80,000 square feet in the San Francisco market since 2008.

The Outcome

As of March 2011, 555 Mission Street was 88% leased and well positioned for sale into a strengthening investor market. In addition, subsequent to its completion, 555 Mission Street received LEED® Gold certification from the U.S. Green Building Council. It was the first new Class A office tower to achieve this status in San Francisco.

Summary

With its expertise in every aspect of real estate, Tishman Speyer has an intimate understanding of how to manage projects in changing economic times to maximize our assets.

555 Mission Street demonstrates Tishman Speyer’s ability to sustain the value of our investments while maintaining our commitment to the environment.