An “ultra-luxury” condo building in San Francisco topped the $4,000-per-square-foot mark for the first time since the pandemic, less than a year after the market bottomed out at just above $1 million as buyers left the city or turned to single-family homes.
The median price for condos in the city was $1.2 million in September, according to Redfin data. That’s almost back to the pre-pandemic median of $1.28 million in April 2020. Once shelter-in-place rules kicked in, people turned away from the smaller square footage and shared amenities of condo life.
One Steuart Lane, the last remaining development completed on the Embarcadero, had “several” water view units break the threshold, according to Paul Zeger, president of Polaris Pacific, which is handling sales for the 120-unit property.
“We were asking huge numbers but because of the views and water access we felt people would pay super premium prices,” Zeger said. High-end buyers “typically want to do things that make them seem smart, and smart is buying when the market is down.”
Some condos in the 20-story SOM-designed glass building also closed for far less, closer to $2,000 a square foot. The variation depends mostly on the view, Zeger said, with higher floors netting higher prices. Amenities such as large terraces and great rooms also push up prices.
Buyers have mostly been from the Bay Area, with “C-Suite people” and those in tech leading the charge, Zeger said. Many live in the South Bay or the Peninsula and are looking for a pied-à-terre that will impress their equally affluent friends, he said.
The sales were the first condos to surpass $4,000 per square foot price since 181 Fremont broke city condo records with the 2018 sale of its penthouse for $15 million, or just over $4,500 per square foot. In 2015, a buyer paid more than $5,500 per square foot for a full-floor penthouse in 2006 Washington Street. That Pacific Heights building is a co-op, not condominiums.
It took more than 10 years for Paramount Group, a publicly traded REIT, to turn a former parking garage that was part of its 2007 One Market Plaza deal into One Steuart Lane. Zeger said the COVID shutdown just months after the sales office opened in the fall of 2019 is “every developer’s nightmare.”
“It’s like having a party and nobody comes,” he said.
The sales team had “five good hours to cry and say woe is me,” and then switched to a virtual tour model, Zeger said. It also had more interest than other condo buildings during that time because of the building’s position as the last to be developed along the Embarcadero.
Sales picked up further as vaccines rolled out, although there was a Delta dip at the end of the summer, Zeger said. The building is 30 percent sold and he says it may take two years to sell out completely. Residents began moving in three months ago.
“COVID got in the way a little bit, but it’s still on that path,” he said.