SF New Developments

by Carolyn Said, Chronicle Staff Writer

San Francisco’s Pacific Telephone Building, an Art Moderne architectural gem built in 1925, has provoked a spirited bidding war among real estate developers with dozens of offers for the landmark skyscraper, according to sources familiar with the transaction.

Owner AT&T confirmed that it is selling the 26-story building at 140 New Montgomery St., which has been vacant for 18 months.

“We were assessing the market and waiting for improved conditions,” said AT&T spokesman John Britton. “We think the time became right with the opening of the St. Regis a stone’s throw away. That indicated this is a hot spot and a great location.”

Britton said AT&T did not name an asking price. It is common in commercial real-estate sales to let the market set the price.

Real estate experts said the property might go for $400 to $500 a square foot, which would give the 26-story, 342,000-square-foot building a price tag of $136.8 million to $171 million.

The deal includes a 441-space, eight-level parking garage on Natoma Street behind the Pacific Telephone Building. Experts said it might fetch $20 million. The San Francisco Museum of Modern Art now uses the parking structure, which is directly behind the museum. SFMOMA will continue with its plans to build a sculpture garden atop the garage, and that will be part of the deal for whoever buys the buildings, Britton said.

Potential uses for the Pacific Telephone Building include offices, luxury condominiums, a high-end hotel or a combination of hotel and condos.

The St. Regis, which Britton pointed to as a comparable, combines a 260-room hotel with 102 luxury condos. It also encompasses the Museum of the African Diaspora, offices and two restaurants.

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