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Commercial
San Francisco

Ashkenazy, Brookfield’s distressed Union Square property in SF sees 40% value cut

$63.4M appraisal of retail site may not include Bulgari’s exit

SF’s Distressed One Union Square Building Loses 40% of Value
Brookfield U.S. Retail CEO Kevin McCrain, Ben Ashkenazy and 200 Stockton Street (Brookfield, Getty, Google Maps)

A new appraisal on Brookfield Properties and Ashkenazy Acquisition’s distressed One Union Square building in San Francisco shows a 40 percent drop in value — and that may not include the imminent departure of one of its biggest remaining tenants.

New York-based Ashkenazy and mall owner GGP — now the retail arm of Brookfield — bought the property, which includes 200-212 Stockton Street and 172-180 Geary Street, in September 2013 for $95.8 million from Frankfurt-based real-estate fund Deka Immobilien, according to property records. Citigroup originated a $50 million interest-only loan that same month; it was later repackaged as a commercial mortgage-backed security with a balloon payment due last October.

Ashkenazy and Brookfield missed that payment, putting the loan into special servicing. US Bank launched a judicial foreclosure on the building in February. Ashkenazy said in a statement at the time that it was in discussions with the lender towards “a positive solution.” 

When the loan originated just over a decade ago, the building was 99 percent occupied and worth $110 million. But servicer reporting from this month lowered the value to $63.4 million, according to Morningstar. Since the new value was dated Jan. 15, 2024, it is unclear if the valuation included the news TRD broke earlier this month that Bulgari is leaving the building and moving across Union Square to Grosvenor’s 200 Grant Avenue building.

The new appraisal represents a 42 percent loss in value since the loan originated.

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With Bulgari out at the end of the year, that will leave the 42,000-square-foot building 85 percent vacant. In 2022, Vera Wang departed and has not reopened a location in the city. Last year, WeWork said it would seek to terminate its lease, which runs through 2029, as part of its Chapter 11 workout. 

Those exits brought occupancy to about 56 percent, per servicer comments, and Bulgari represents another 40 percent. When the Italian jeweler departs, Moncler and Lacoste will be the only remaining tenants in the building, with a total of about 6,000 square feet.

Lacoste, through its U.S. licensing arm Devanlay Retail, has a lease through the end of this year but has already moved out. Moncler’s lease is up in early 2026.

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CommercialRetailSan FranciscoUnion Square