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Bank of America Takes S.F. Center Off the Market

April 17, 2001|From Bloomberg News

Bank of America Corp. and its partner have decided not to sell Bank of America Center in San Francisco after offers fell short of the expected price tag of more than $800 million, newspapers reported.

The bank and its partner, Shorenstein Co., received final bids for the 52-story tower at the end of March, the San Francisco Chronicle and San Francisco Business Times said. The finalists included Chicago-based Equity Office Properties Trust, financier Marvin Davis and at least one unidentified bidder.

The 1.8-million-square-foot property was put up for sale in October. Since then, the market for top-tier office properties has weakened as the economy has slowed. In the last six months, several buildings, including the Chrysler Building and 14 Wall Street in New York, were pulled off the market when bids fell short of expectations.

Boston Properties Inc. dropped out of the bidding for Bank of America Center out of concern the asking price was too high. Raymond Ritchey, executive vice president of Boston Properties, told a group of investors in February the sellers were asking more than $500 a square foot, or about $900 million.

"As excited as we are about the San Francisco market, we felt it was a very large premium to pay," Ritchey said at the time.

Downtown San Francisco's office vacancy rate rose to 7.6% in the first quarter from 3.8% in the fourth quarter, as Internet-related firms shrank or folded, according to Grubb & Ellis Co. Bank of America remains the largest tenant in the namesake property.

Bank of America spokeswoman Juliet Don told the Business Times that the two owners would continue to explore other options. A spokesman for Shorenstein declined to comment.

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