San Francisco Financial District tower draws no bids at auction

On the sidewalk near City Hall, a 20-story tower in San Francisco’s North Financial District went to auction and drew no outside bids, a blunt sign of how battered the city’s office market remains. The building at 600 California St., a 360,000-square-foot Class A tower once valued at more than $320 million, ended up changing hands only through the debt holder’s credit bid.

The property was tied to a distressed $240 million loan after WeWork stopped paying rent in March 2023. WeWork later cut its footprint in the building to 43,520 square feet, and its lease runs through the end of 2030. The tower went into receivership in November 2023, and Dallas-based Lone Star Funds bought the mortgage in January 2026 for about $130 million from Goldman Sachs before stepping in at Thursday’s auction with a $216 million credit bid. That works out to roughly $361 a square foot. Lone Star declined to comment on the sale.

The numbers show how far the market has fallen. The tower was appraised at $109 million in 2024, down nearly 70% from its 2019 value. That scale of loss is not an isolated case in San Francisco, but 600 California St. still stood out because office buildings here do not trade often. The last major benchmark sale nearby was 350 California St., which was estimated at about $300 million in 2019 but sold in 2023 for roughly $60 million to $67.5 million, resetting expectations for what downtown office space is worth.

For lenders, the no-bid result reinforces the risk embedded in older office towers with large vacancies and expiring leases. For nearby businesses, it is another reminder that the Financial District has not fully regained the daytime traffic that supported cafes, lunch counters, and transit riders before the pandemic. And for the city’s budget planners, the slide from a $320 million-plus valuation to a $109 million appraisal points to a thinner property-tax base if assessments keep resetting lower.

That pressure lands as the broader market is still trying to stabilize. CBRE put San Francisco’s overall office vacancy rate at 30.4% in the first quarter of 2026, and SF.gov says downtown office vacancy is a key indicator of the city’s post-pandemic recovery. The no-bid auction at 600 California St. suggests that recovery narrative still has a long way to go.