3% cap rate @ 90% occ.; $750/ft office tower - SOLD

[J. Martin]

I posted previously about a 2% cap rate on a duplex in San Francisco I saw, which isn't the best example for such a small property. But here's an office tower around the corner from my office in SF, and is selling for a 3% cap rate, even at 90% current occupancy. Obviously, there's not a lot of upside on additional lease-up (assuming some options on space and almost full), so additional gains are going to have to come from rent increases and appreciation.. wow. Curious, what kind of cap rates are people seeing in other major metropolitan areas on Class A office? How about Class C out in rural areas..? I've seen beat-down properties in the inland empire & san joaquin valley sell for as low as $75/ft or lower in bad condition.. But prices going up.. wow. different world out here..

"At $750 a square foot, it’s San Francisco’s most expensive deal for a stabilized office property in the past year, the person said. The tower at Second and Mission streets, completed in 2000, is 90 percent leased. "