A conglomerate of big-name banks just finally bought the San Francisco Centre mall for a fraction of its previous value, though this tells us nothing about what will happen to the mall, as those banks are just going to sell the place again.

It’s been a sick and twisted running joke in the SF commercial real estate industry how many times the foreclosure auction of the hollowed-out former Westfield Mall (now called San Francisco Centre) has been delayed. That auction has been delayed not once, not twice, not three times, but nine times. This is likely because the value of the building kept changing as tenants continued fleeing through the course of this year.

The trouble started in mid-2023, when the owners Westfield Corp and Brookfield Properties abandoned the property to its lender and stopped making loan payments. And it’s been nothing but death spiral for the mall since, as that news arrived about a month after Nordstrom announced they were closing their giant department store there, and every retailer in the place you could name quickly followed suit. Last we heard, the mall was 95% vacant.

But the ninth auction was the charm. The SF Business Times has reports that the San Francisco Centre mall finally sold at auction on Wednesday to a conglomerate of banks and investors headlined by Deutsche Bank and JPMorgan Chase, per the Business Times. (The auction actually happened on the steps of SF City Hall on a chilly November day.) The minimum bid was $133 million, which is exactly what the conglomerate of banks offered. They were the only bidders.

There are some minor inconsistencies in the Business Times’ report and the Chronicle’s report on the matter. The Chronicle lists the sale price as $134 million instead of $133 million, though that may just be a rounding difference. The Chronicle also names "Goldman Sachs and JPMorgan Chase" as the buyers, though again, all of those banks may be involved in the buyers’ group. This is breaking news that just came out, and we’ll get clarity in the days to come.

But there’s no disputing that the bank conglomerate got this property for a laughably cheap price compared to previous valuations. In 2016 the property was valued at $1.2 billion, per the Chronicle. So the $133 million sale price is just 11% of that value from nearly ten years ago.

And the banks are just going to turn around and sell the property again, effectively hoping to flip it for some manner of profit. The Chronicle and the Business Times both confirmed that real estate brokerage CBRE will be the banks’ commercial realtor trying to sell the property, with the listing hitting the market possibly as early as next week.

"Amid renewed civic leadership, three consecutive years of positive population growth and surging demand from artificial intelligence and technology firms, San Francisco Centre & Emporium is uniquely positioned to anchor the next chapter in downtown San Francisco’s recovery,” CBRE executive vice president of capital markets team Kyle Kovac said in a statement to the Business Times.

Well of course he would say that, he’s a realtor trying to sell the place! That property is still the poster child for the SF “doom loop,” and it would take a massive investment to reinvent the place before a penny of revenue ever even comes in.

Well, maybe there are a few pennies coming in. We noted the facility is 95% vacant, and SFGate reported last month that there are only two restaurants left in the mall’s once-mighty downstairs food court, Panda Buffet and Shake Shack.

The listing shows the Nordstrom component of the property is owned and leased by the SF Unified School District (who claim they’re owed millions, so that’s another headache for a new owner). The bank conglomerate bought the rest. The building is approved for a 400-foot height limit, so a “mixed-use” incarnation of housing, offices, and/or retail is a possibility.  

We’ve also seen wild trail balloons floated that the property could become a soccer stadium or pickleball courts. These seem like longshot scenarios, but first, the property needs to worry about the longshot scenario of someone wanting to buy the place.

Related: Beleaguered Former Westfield Mall Gets More Beleaguered, Loses Six More Restaurants [SFist]

Image: Justin C via Yelp