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News Release: For Sale: 3838 California, San Francisco – Anchored by Sutter Health

OFFERING SUMMARY

HFF is pleased to present to qualified investors the opportunity to acquire the 100% fee simple interest in 3838 California (the “Property”), an 82,805(1) square foot institutional-quality medical office building located in the prestigious Presidio Heights neighborhood within the City of San Francisco. The Property represents a fortress risk profile, and the first institutional core medical office building to be offered for sale in San Francisco in over two decades. 3838 California is one of the largest outpatient facilities in the Northwest Quadrant of the city and is anchored by Sutter Health (Moody’s: Aa3), the dominant healthcare provider serving the San Francisco Bay Area. Sutter has recently signed a significant lease extension and expansion on the 8th floor and now represents 38% of the in-place tenancy with a weighted average lease term of over seven years. Several value enhancement opportunities exist including optimizing the parking structure revenue, leasing 13,117 square feet of remaining vacant space and marking-to-market 12,605 square feet of space expiring during the first 16 months of ownership with rents approximately 36% below market, to list a few. The Property benefits from the unrivaled surrounding demographics and exceptional physical and economic barriers to entry, resulting in what is truly an irreplaceable location.

PROPERTY SUMMARY

ADDRESS: 3838 California St., San Francisco, CA 94118

ASSESSORS PARCEL NUMBER: 1015-054

SQUARE FOOTAGE (IN-PLACE): 81,181 RSF

SQUARE FOOTAGE (BOMA): 82,805 RSF (1)

OCCUPANCY (IN-PLACE): 84%

10 YEAR AVG. HISTORICAL OCCUPANCY: 96%

ON-SITE PARKING: 222 Subterranean and Structure Spaces (2)  (2.68 per 1,000 SF)

YEAR BUILT/RENOVATED: 1973/2016

ACREAGE: 0.50 Acres

ZONING: RM-2

WALK SCORE: 90

SEL (2018): 14%

Generational Opportunity Within The City of San Francisco

Generational opportunity to acquire one of only seven non-health system owned 50,000+ SF medical office buildings within the City of San Francisco

3838 California represents the first core-profile MOB to be offered for sale in San Francisco in over two decades

Significant discount to replacement cost, estimated to be well in excess of $1,200 per square foot, in a market with substantial barriers to entry

Exceptional Tenancy: Anchored by Sutter Health & Prominent Healthcare Providers

Sutter Health (Moody’s: Aa3), the dominant healthcare provider in the Bay Area, with 50,000 employees and 11 million patient visits per year system-wide, is the anchor tenant at the property representing 38% of the in-place tenancy. Sutter Health offers a variety of departments on site, benefiting from the exceptional demographics and payor mix this location offers. Many of the tenants within the Property have affiliations with Sutter Health, further optimizing the referral patterns and synergies between the various practices. There are many other notable tenants in the building, including California Pacific Orthopaedics & Sports Medicine, the Bay Area’s leading orthopaedic practice; California Skin Institute, the largest private dermatology group in the state; San Francisco Ear Nose & Throat (SFENT), which has 4 offices and treats patients at 6 hospitals in San Francisco; and Brown & Toland Physicians, a group with over 2,400 local, board-certified physicians.

SUTTER HEALTH REPRESENTS 38% OF THE IN-PLACE TENANCY

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