Ridge Capital Investors is in talks to purchase the loan backed by 201 California Street for about $75 million, according to a report by the San Francisco Business Times. The transaction would value the 17-story office building at approximately $275 per square foot.
The property, located in San Francisco’s Financial District, is currently owned by Columbia Property Trust. Columbia has been seeking to offload the building after defaulting on a $1.7 billion mortgage that included 201 California and six other properties in 2023.
Columbia had previously secured an extension on the loan’s maturity date until July of this year, with an option to extend into early next year. The company chose not to use that additional extension and was unable to pay off the loan. Selling the debt to Ridge Capital could allow both Columbia and its lenders to resolve the situation without further extending the loan.
Marketing materials described the debt sale as “a path to ownership” for prospective buyers. If Ridge Capital completes the deal, Columbia may transfer ownership of the building through a deed in lieu of foreclosure.
The building has experienced a significant drop in valuation. It was appraised at $81.5 million in February, compared to $218 million in 2021. Columbia purchased 201 California from Beacon Capital Partners in 2019 for $238.9 million. At that time, occupancy was at 99 percent; when it went on the market this summer, only 35 percent of space was leased.
Ridge Capital has focused on acquiring distressed office assets in San Francisco. In 2023, it bought 180 Howard Street through a $54 million sale-leaseback transaction. Earlier this year, it acquired a loan secured by 33 New Montgomery Street using a similar approach involving loan acquisition and deed in lieu of foreclosure.
— Chris Malone Méndez
