333 Bush Street
“Hines and Sterling American Property will give 333 Bush St. back to lenders Brookfield Real Estate Finance and Munich Hypo Bank, according to a statement from Hines executives.” (Hines, Sterling to surrender S.F. building)

23 thoughts on “333 Bush: Bought For $281M In 2007 But Now Going Back To The Bank”
  1. This is the Heller building. Hines owns 101 2nd also and that was the Thelen building.
    I remember the good ol days of Hines sponsored ice cream socials at 101 2nd. Guess those days are over.

  2. Ironically enough djn, I work in the 101 2nd St. building, and we just had a Hines-sponsored gelato social yesterday! 🙂

  3. I’m really curious about how the condos at the top might be impacted by this. I suppose all the legal bases must be contractually covered to minimize problems for this kind of office/hotel mix with condos. But what about HOA issues?
    Are they considered a separate entity or building when something like this happens? Or individually owned units that happen to sit atop a building going back to the lender?
    Just kinda questioning ‘out loud’ here as I’ve wondered about this before. It’s beginning to sound like some of the hotel combos are in a similar position.

  4. 101- What ever happened to the Thelen space? I left Thelen long before the implosion and I was curious if someone took over the space

  5. I used to work here. Not a great building – especially after working at One Maritime Plaza. Interesting question about the condos. There are all kinds of issues with mixed use that nobody ever anticipated.

  6. Where do these guys buy their press releases? After giving back several other properties in the BA they jingle mail the keys to the lenders and state they “are financially sound and well positioned.” Millennium defaults on $90M at 4 Seasons and insists it’s “strategic” and every thing is just dandy with their other properties.
    How sound can they possibly be? How do they now have the financial credibility to move forward with Transbay?

  7. djn – I think some of the old Thelen space is leased. There are definitely people getting off the elevators on some of the old Thelen floors. But you can tell the occupancy is somewhat lower than in previous years (I’ve been here since Anderson Consulting died in 2002).

  8. How sound can they possibly be? How do they now have the financial credibility to move forward with Transbay?
    Dude, lighten up! Those were drawings.

  9. Funny how you don’t see executives going on TV to sob about how the bank just won’t work with them to save “their” office building.
    The moment the numbers show that paying the mortgage isn’t going to benefit them they just walk away without a qualm. Iz jus bidnez. Nuttin’ personal.
    I still say that before this is over we’ll see this attitude seep into the homeowner population and we’ll see a wave of ruthless defaults. One day they’ll come to the realization that writing that mortgage check every month isn’t benefiting them and they’ll throw the keys on the roof and walk away.

  10. We looked at the unit for sale on the 37th floor. SO happy we didn’t buy it. There is a unit on I believe the 38th floor that was at one time listed for 1.3 million that is now for rent for some absurd amount of money. I can’t believe that the owners will not be impacted by this euphemistic foreclosure (“Giving the building back to the lender”? Give me a break!)

  11. it’s already happening diemos, and i agree it will get worse.
    i have 2 separate colleagues in my immediate entourage who have either done it or are considering it.
    couple #1: older, 5ish years from retiring, grown kids on their own, cashed out of east bay house a few years ago, put very little down on a smaller eb house. when payment reset much higher a few months ago they walked, couldn’t see being saddled at their age with declining value and larger payment. both work, could easily afford it, just didn’t make sense to them. no qualms.
    couple #2: much younger, moved to bay area 2005, paid well north of 600k for home in east bay. house way underwater. 2 kids under 8, they could rent the identical house 2 doors down for less than 1/2 their current payment -and- they will reset/recast up next summer by a very large amount. they are currently torturing themselves about what to do. very nice people, i feel badly for them.
    gotta think this is happening all over the place, including certain parts of sf.

  12. It’s smart imo to walk away from an underwater house, and the potential walkaways should try to get as much “free rent” out of the deal as possible on the way out. No one should have any “moral” qualms about it. Evaluate the legal and tax implications and weigh the risks versus benefits – sure, that makes sense. But “torturing” one’s self about the “morals” of it? LOL, just tell them not to be suckers.
    They should get some advice on stashing identifiable assets right now into bk-remote vehicles, which isn’t too hard for most people without huge assets. It just requires a little planning.

  13. As this article (finally) makes clear – the office shakeout will not center around the little B and C buildings that no one ever heard of near jackson square and upper market street. they are just the tip of the iceberg –
    here is the “watch list” for office building -in San Francisco ”
    1) Anything purchased since January 2006 by:
    Morgan Stanley
    etc. etc.
    thats assuming all the sovereign wealth fund deals sit tight forever —
    2) Any acquisition mentioned in same period on page 1 of the Business Times same period that has the words “bagged” and “trophy” in the text
    One Maritime Plaza
    One Market Street
    555 California Street
    150 California Street
    1 Sansome
    575 Market Street
    etc, etc.

  14. “The foreclosure comes at a time when downtown office values are in free fall”, so then why would Hines still say they are going to build the Transbay Tower?

  15. “so then why would Hines still say they are going to build the Transbay Tower?”
    they got the time if you got the money honey.

  16. I’m not really sure why everyone talks about “walking away” from the loan. Thankfully, I don’t have any close friends that are in the situation of defaulting. However, my next door neighbor’s title was taken over by recontrust in late 2007 and I’m still waiting for someone to kick them out. In the meantime, they keep dealing, and I can tell you it ain’t jazz cigarettes.

  17. Bring you checkbooks to the courthouse on December 3. PropertyShark is indicating an unpaid balance of $233,784,407.

  18. Brookfield properties has bought 333 Bush. Sedgwick moved in recently. Condos on the upper floors are not doing well. We looked at a unit last summer despite warnings from my Realtor that the agent who gets most of the listings at 333 Bush is rude and unprofessional. We did not listen to her, went to an open house and walked away. The agent was acting like she was having a menopausal breakdown. The management company should do something about their reputation. The entry to the building looked old and needed a major renovation and the lobby looked outdated. The only positive was the nice security guard.

  19. Someone I know almost bought a unit at 333 a few months ago. He changed his mind when he read the disclosures. They have done a remodel managed by a board member who paid himself using HoA funds and have spent major amounts of money. They still have pending assessments. HoA paying a board member and the property manager representing sellers in the building did not sound right.

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