Avison Young Lists Broadway Hotel - San Francisco, CA
The Broadway Hotel is a mixed-use retail/residential hotel located in a world-class location on the border of Nob Hill and Russian Hill, in one of San Francisco's most affluent and desirable neighborhoods. The subject site is rectangular and measures 7,551 square feet. The 26,659 square foot, 4-story building was built in 1907 and consists of 81 rooms with shared baths, three community kitchens, a manager's apartment and eight retail spaces with approximately 6,767 square feet of Gross Leasable Area (GLA). This pride of ownership asset is located at the southeast corner of Broadway and Polk Street close to public transportation, dining, and nightlife, major tourist attractions and employment districts. Both the ground floor retail and upstairs SRO Hotel are leased to long-term tenants at rents far below market, many of which are on a month-to-month bases.
The retail portion of the property enjoys 137.5 feet of frontage on Polk Street and 54.916 feet of frontage on Broadway. Polk Street is a highly desirable retail corridor with some of the highest neighborhood retail rents in San Francisco. To the north of the Property (at northeast corner of Pol & Broadway) is a Walgreens followed by numerous high-end restaurants, bars, coffee shops, boutiques, and other retail establishments. Additionally, the building's corner location and high traffic counts allow for signage on Polk Street with a single billboard currently leased at $1,100 per month. The retail spaces vary in size from +/- 768 feet to +/- 857 square feet with the potential to combine some of the spaces into larger spaces. All current leases are modified gross with 6 of the 8 tenants on a month-to-month basis.
Residential Hotel (SRO)
Above the retail portion of the building is a +/- 81-room SRO (Single Room Occupancy) hotel that is master-leased to a local operator on a month-to-month basis. The lease is well below market with the tenant paying a base rent and operation below market with the tenant paying a base rent and operating expenses for the hotel. 100% of the units are SRO and therefore must be rented on a weekly or monthly basis. The exception to this rule is during the five month peak tourist season between May and October when residential hotel operators may rent up to 25% of their vacant rooms on a nightly basis. Additionally, occupied SRO units in San Francisco are subject to rent control that limits annual rent increases to a percentage specified by the Residential Rent Stabilization and Arbitration Board. Given the City of San Francisco's commitment to protecting low income housing (i.e. the Residential Hotel Ordinance), it is highly unlikely that this property will be converted to an alternative use in the foreseeable future.
The units are relatively large by SRO standards measuring between 156 to 202 square feet. All units share common hallway bathrooms and each floor has a community kitchen.
There are a number of compelling aspects to this investment opportunity, which should provide a significant increase in value for an investor, which are as follows:
- 81-room SRO hotel (currently operating at +/- 78 rentable rooms)
- Eight (8) ground floor retail spaces with estimate 6,767 square feet
- Trophy corner building in A+ location
- Substantial upside in rents on retail and hotel
- Master lease on hotel and 6/8 retail leases are month-to-month
- Flexibility fo buyet to operate or master lease SRO hotel
- Highly constrained market with huge barriers to entry
For more information on this listing, contact
- Office: 424-369-8016