investigation
Kilroy Realty invested $579 million to rebuild SoMa market, with no return on investment
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Where have all the flowers gone? For the San Francisco Flower Market, not far away.
The city’s wholesale flower market is uprooting from its home of 58 years in South of Market and moving to 901 16th Street, on Potrero Hill, the San Francisco Chronicle reported.
The 125,000-square-foot market at 640 Brannan Street will close in a cluster of warehouses at Sixth and Brannan streets on Dec. 26. It will reopen a week later on an acre in Potrero Hill.
The market employs 300 people and supports dozens of small businesses, from florists in San Francisco to farmers along the Central Coast. Of its 40 flower market tenants, 27 will move their stands and 13 will retire or strike out on their own.
The San Francisco Flower Market was forced out of its 4-acre home since 1956 in Central SoMa by redevelopment.
In 2014, Los Angeles-based Kilroy Realty purchased the Flower Market site for $70 million, with plans to build a 2. 2 million-square-foot campus with 3 buildings ranging from 8 to 18 stories.
After the dealers agreed to save the market, Kilroy agreed to a transitional location and then incorporate it into development.
The flower merchants only wanted to move once, so Kilroy bought Potrero Hill for $99 million and agreed to build a new market.
Then the job market slowed a pandemic transition to remote work, and Kilroy found himself holding the daisy.
In total, Kilroy spent $579 million to put together a 6-acre tract in downtown SoMa and another acre in Potrero Hill, while building a new flower market, without knowing when he would recoup his investment, according to the Chronicle. .
The vacancy rate in San Francisco is 36. 9 percent, according to CBRE, and it may get worse before it gets better.
Kilroy Vice President Mike Grisso said in a statement that the firm “is pleased to have delivered a new, state-of-the-art wholesale flower market that will allow the flower industry to thrive well into the future.”
The new market covers 216,000 square feet, adding 125,000 square feet for flower vendors and 90,900 square feet for parking for 150 cars and 23 bicycles, according to SFYimby. Its wavy exterior should be painted violet.
The agreement with Kilroy also includes a $20 million grant for taxes and other expenses that will take effect in the workplace allocation structure. If the job market does not do so and the allocation is rarely built up, market tenants could simply pay the price, according to the newspaper.
—Dana Barthélemy
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