SAN FRANCISCO — TIAA-CREF and joint venture partner Norges Bank Investment Management (NBIM), manager of the Norwegian Government Pension Fund Global, have purchased The Orrick Building in San Francisco’s South Financial District for a reported $390 million, according to Reuters.
The two organizations will own and operate the 10-story, 521,555-square-foot property, also known as Foundry Square II. TIAA-CREF will own a 50.1 percent interest while NBIM will own 49.9 percent.
“Today’s announcement enhances TIAA-CREF’s existing real estate portfolio and demonstrates our ability to source premium properties on behalf of the joint venture,” says Suzan Amato, head of strategic joint ventures for TIAA-CREF. “These acquisitions are reflective of our real estate investment goals — to take a long-term investment approach with an emphasis on large, high-quality assets in gateway cities.”
The Class A, LEED Platinum-certified property is located on the corner of Howard and First streets within one block of the future Transbay Transit Center, a $4 billion regional transit hub that will connect eight Bay Area counties through 11 transit systems.
The property is 100 percent leased to 12 tenants, with law firm Orrick Herrington as the asset’s largest tenant. Other major tenants include Moody’s Analytics, BlackRock and FitBit.
“We began investing in San Francisco’s South Financial District more than a decade ago with the purchase of another South of Market office property, 50 Fremont St.,” says Rich Kimble, senior director and head of acquisitions in the Northwest for TIAA-CREF Global Real Estate. “Since then, we’ve consistently been active in the Bay Area with a number of other office, retail and multifamily acquisitions.”
TIAA-CREF is a national financial services organization with $613 billion in total assets under management as of Sept. 30, 2014. The entity is the leading provider of retirement services in the academic, research, medical and cultural fields.
Norges Bank Investment Management is the asset management division of Norges Bank, the Norwegian central bank. The fund is invested globally in equity, fixed income and real estate markets and had assets worth roughly $890 billion at the end of August 2014.
— John Nelson