First Citizens Bank Expands Bay Area Footprint

Raleigh, N.C.-based First Citizens Bank & Trust Company — a wholly owned banking subsidiary of First Citizens BancShares, Inc. — recently announced the acquisition of an office property in San Francisco. The new owner expects to occupy a portion of the building and will reportedly also seek tenants.

Located at 667 Mission St., the asset puts First Citizen Bank in the cultural heart of downtown and will support the company’s growing client base across the region. The six-story building incorporates more than 160,000 square feet of San Francisco office space and features an 8,000-square-foot rooftop terrace and event space that’s home to one of just a few roof gardens in downtown, as well as skylights and large windows opening up expansive views of the city in every direction.

The property is easily accessible within walking distance of several transit stations and stops, and is also within walking distance of more than 70 nearby retail and dining establishments, hotels, and attractions, such as SFMOMA, Yerba Buena Center for the Arts, and the Yerba Buena Gardens.

“San Francisco is a key market within the innovation economy, and this latest acquisition is evidence of our ongoing commitment to being a part of the local ecosystem,” said Marc Cadieux, president of Silicon Valley Bank, a division of First Citizens Bank. “We’re thrilled to announce this investment that underscores First Citizens’ long-term plans to grow in the Bay Area.”

The deal marks the bank’s second commercial real estate purchase in the Bay Area since the start of the year. The firm’s previous Bay Area acquisition closed in August, when First Citizens Bank reportedly bought the 250 University Ave. building in Palo Alto, Calif., for $82 million. Working out to about $1,969 per square foot, the transaction harkened back to the price tags of office sales in hot markets prior to 2020.

First Citizens Bank is set to renovate the office space in both properties with 2027 as the delivery date for each.

California Markets Remain Among Priciest in Country

At the start of November, year-to-date office sales in the Bay Area totaled nearly $4.4 billion with sales closing at an average of $386 per square foot. During that same time, office spaces changing hands in the San Francisco market claimed a total of nearly $1.2 billion at $279 per square foot, on average. Although these represented some of the highest values in the country, their combined $5.6 billion in sales still fell short of Manhattan, N.Y.’s tally of $6.4 billion, as well as its sale price average of $523 per square foot.

Both of these California markets saw vacancy rates above 20% in October, but nevertheless commanded some of the highest asking rents in the country: San Francisco office space asked an average of $65.30 per square foot (second only to Manhattan’s $67.97 per square foot), while office space in the Bay Area asked $51.59 per square foot, on average (the fourth-priciest in the country in October).