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SanFranciscoBusinessTimes April5,2013,Page1MillenniumTowerinSanFranciscois

a$750M

sellout

BignamebuyershelpcondohighrisesmashWestCoastrecordJ.K.Dineen,Reporter SanFranciscoBusinessTimes

Fiveyearsand$750millionlater,theWestCoastsmostluxuriouscondoprojectissoldout.MillenniumTower,aglassyslateblue60storyhighriseat301MissionSt.,closedthelastofits

419units,thecompanysaid.Despitesellingthroughtheworsteconomiccollapsesincethe

GreatDepression,thetowergenerated$750millioninsales,a25percentreturnoncostforthe

$600million

development.

The

units

averaged

$1.8

million,

with

penthouses

selling

for

as

much

as$9.8million,or$1,970asquarefootfora5,000squarefootpad.Thecondotowerwasthetallestandmostexpensiveresidentialhighriseconstructedonthe

WestCoast.FamousresidentsincludeTomPerkinsofKleinerPerkinsCaufield&Byers,football

executiveCarmenPolicyandHallofFamefootballiconJoeMontana.Thereweresomeprettydifficult,unsettlingtimesin2009,butwestayedthecourse,said

RichardBaumert,apartnerwithdeveloperMillenniumPartners.Wesawitthroughandinthe

endourplanandvisionfortheprojectwerevalidated.SanFranciscoscondomarketwasstillinoverdrivein2008whenMillenniumPartnersopened

itssalesofficeandbeganpresellingunits.ByApril23of2009,whenthebuildingopenedits

doorsandthefirstsalesclosed,theeconomywasintatters.Whileotherdevelopersracedtocut

pricesandunloadinventory,Millenniumimplementedaonetime15percentreductionthat

wasretroactivetobuyersalreadyincontract.Thedevelopermadethedecisiontokeepthe

pricecuts,evenasthemarketbouncedbackin2012and2013.Towardtheendtheysoldoutataveryfastpace,saidGreggLynn,aluxurybrokeratSothebys

InternationalRealty.Theycouldhaveraisedpricesandeasilysoldthoseunits,buttheystuckto

theoriginalpricing.DesignedbyarchitectGlennRescalvoofHandelArchitects,MillenniumTowerwasthesecond

luxurydevelopment

that

Millennium

Partners

built

in

San

Francisco.

In

2001,

Millennium

PartnersopenedtheFourSeasonsHotelandResidences,the100,000squarefootSports

Club/LA,andretailspacethatfrontsbothMarketStreetandYerbaBuenaLane.Other

MillenniumPartnersdevelopmentsinSanFranciscoincludetheentertainmentcenterMetreon

(inwhichMillenniumlatersolditsinterest)andtheretailalongYerbaBuenaLane.The

developeriscurrentlywrappingupentitlementsforanewtowerandMexicanMuseumat706

MissionSt.

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Lynn,whohasrepresentedaboutadozenMillenniumbuyers,saidMillenniumPartners

executedanincrediblemarketingandsalesprocessthatresultedinthemsellingthroughvery

differentmarkets.Currently,justthreeMillenniumunitsareontheresalemarketonefor$4.5million,onefor

$5million,andonefor$6.2million.Allthreerepresentasignificantpremiumoverwhatthe

sellerpaidforthecondos,thoughtheyalsoinvestedmoneyoninteriordecoration.Thesituationwearefacingisthateverybodywantstobuyintothatbuildingandtheyare

kickingthemselvesthattheydidntwhentheyhadthechance,hesaid.Ivebeencontactedby

dozensofbuyersandagentstryingtogettheirclientsintothebuildingatthe$2millionor$3

millionrangeandthereisnothing.Thereisnoinventorybelow$4million.LynnsaidtheMillenniumTowerisourbuildingofthemoment.WhileMillenniumPartnerswill

buildanothertowerat706MissionSt.andTishmanSpeyerisconstructingthenextphaseofthe

Infinitytowersat201FolsomSt.,neitherwillbedeliveredforafewyears.Ithinkitsgoingto

lastalotlongerthanthemomentbecausetherearenoplanstobuildanotherbuildinglikeitfor

manyyears,

he

said.

Its

going

to

continue

to

set

awhole

new

economic

standard

for

luxury

unitsdowntown.A3,300squarefootunitoriginallypurchasedfor$5million,soldrecentlyfor$7.8millionafter

anextensiverenovation.Peoplewhosellnowareexpectingtocashoutwithmajorprofits,he

said.BaumertsaidtheMillenniumTowerconceptisnotasmuchaboutthephysicalstructureasthe

residentialexperience.MillenniumTowerimplementedLaVie,amonthlyeventsprogram

rangingfromfilmscreeningsintheClubLevelsprivatetheatertofiresidechatswithnotables

suchasresidentsMontanaandPerkinsaswellascelebritychefMichaelMinaandformerMayor

WillieBrown.

Resident

services

include

aprivate

concierge

and

exclusive

access

to

the

20,000

squarefootClubLevel,featuringaprivatediningroom(servicedbyMichaelMinasRN74),a

5,500squarefootfitnesscenteroperatedbySportsClubLA,anda75foot,indoor,

competitionlengthlappoolsetbeneathasoaringskylight.AlanMarkoftheMarkCo.saidtheMillenniumTowersamenitiesandreputationdrewpeople

totheTransbaydistrictwhootherwisewouldnothaveconsideredbuyingthere.Hehasfriends

whosoldhomesonBuenaVistaPark,RussianHillandPacificHeightstorelocatetowhatwas

onceagrittycornernexttoahulkingbusstation.Itbroughtalotofdeeppocketed,olderpeopletoawholenewpartofSoMapeoplewho

five

years

ago

might

not

have

thought

of

living

in

that

part

of

South

of

Market,

said

Mark.

Overthattime,MillenniumTowercameintoitsown.Peoplerecognizedit.Everyoneknew

peoplewhohadmovedintothebuilding.Andfinallyintheendtherewasnoinventoryofthat

qualityavailable.WhiletheMillenniumTowerwasconsideredapioneerwhenbuilt,todayitissmackinthe

middleofadistrictthatisseeing2.7millionsquarefeetofnewofficedevelopmentaswellasa

new$4billiontransitterminal.

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Wealwaystalkedaboutthiswhattheneighborhoodwouldlooklikeandfeellike,said

Baumert.Nowyoucanseeit.Nowitsareality.YoustandonthecornerofMissionand

FremontandlooktoyourleftandseetheTransbayTerminal.TheTransbayTowerisweeks

awayfrombreakingground.Acrossthestreetat350MissionistheSalesforcebuilding.Ithas

reallyvalidatedourplantobuild.