Transbay panel has deal for land key to financing transit center
The board of the cash-strapped Transbay Joint Powers Authority struck a deal Thursday with a developer willing to pay $160 million for a key parcel of land near the transit center, money that is badly needed to finance the first phase of the $2.1 billion facility at First and Mission streets.
Development group F4 Transbay Partners plans to build a mixed-use tower with upward of 300 hotel rooms, 200 residential units and as much as 425,000 square feet of office space.
The tentative agreement, which the board unanimously approved Thursday morning, represents the third time that the transit authority has tried to sell Parcel F, the last remaining development site in downtown San Francisco zoned for a 750-foot tower.
The deal with F4, a joint venture between Hines, Urban Pacific and the Goldman Sachs real estate fund Broad Street Real Estate Credit Partners, is to close by the summer.
Rising material and labor costs have left the transit authority with a $360 million shortfall for the completion of phase one, a figure includes a rainy day fund.
Phase one includes construction of the five-story Transbay Transit Center, bus ramps and an underground box intended to house a downtown Caltrain extension and high-speed rail someday.
Along with struggles to to sell off Parcel F, the transit authority found no corporate sponsors willing to buy the naming rights to the transit center.
Transit authority Executive Director Maria Ayerdi-Kaplan stressed that the developer is taking on all the entitlement risks, meaning that the group has agreed to close on the purchase of the land before gaining the approvals needed to build a soaring complex of condos, hotel rooms and office space.
The money will enable the transit authority to pay back all of a $171 million bridge loan from Wells Fargo and Goldman Sachs, which provided interim financing for phase one, Ayerdi-Kaplan said.
The transit authority board of directors awarded the contracts for the park after December’s Crescent Heights deal, but when that fell through it was unclear how the park would be funded.