San Francisco Office Buildings Sold for $65.5 Million

Hudson Pacific Properties sold two vacant-leaning commercial buildings as local office debt continues to mount.

Updated on Sept. 28, 2026 in Commercial

Bold vector editorial illustration of two aged brick office buildings, representing the changing commercial real estate market in San Francisco. — Hudson Pacific Properties sold two office buildings on Howard Street in San Francisco for $65.5 million as local office vacancy rates remain high. AI Illustration. Upload story photo >

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Hudson Pacific Properties has sold two office buildings located at 875 and 899 Howard Street for $65.5 million. The sale comes as the San Francisco office market faces a vacancy rate of 25.9 percent.

Why it matters

This transaction highlights the ongoing challenges in the commercial real estate sector, where property owners are offloading assets amidst high vacancy rates and significant local debt. It marks a shift for these specific sites, which the seller had held since 2007.

The property sale involved roughly 280,000 square feet, with the 875 Howard building reporting 36 percent occupancy and 899 Howard remaining fully vacant at closing. This occurs against a backdrop of $12.6 billion in outstanding office debt across San Francisco as of August.

The players

Hudson Pacific Properties

A real estate investment trust that owns and manages office and studio properties across major West Coast markets.

Seven Equity Group

A commercial real estate investment firm focused on acquiring and repositioning properties.

Genesis Capital Group

A private lender that provides acquisition and construction financing for real estate projects.

The details

Seven Equity Group acquired the two buildings, which opened in 1920, using a $51 million loan provided by Genesis Capital Group. Hudson Pacific Properties sought the sale to divest from properties with high vacancy levels. The acquisition follows a period of market-wide pressure where San Francisco office vacancy reached 25.9 percent.

The two office buildings originally opened in 1920.
Hudson Pacific Properties purchased the buildings in 2007.
The search for a buyer for the vacant properties began in June 2026.
San Francisco reported $12.6 billion in outstanding office debt in August 2026.
The sale of the properties concluded in September 2026.

Money Landscape

The transaction reflects a broader correction in the commercial real estate sector as owners contend with high vacancy levels. This sale aligns with the ongoing adjustment period for city-wide office valuations amid $12.6 billion in total outstanding debt.

While this sale is a commercial transaction, it signals the ongoing shift in the local property tax base and downtown economic activity. Residents should monitor how these shifts impact municipal revenue and local services when reviewing city budgets.

The takeaway

Commercial property sales in high-vacancy environments reflect a strategic shift for institutional owners. Keep an eye on local real estate assessments to understand how large-scale office divestments may influence the city's long-term fiscal health.