San Francisco Business Times

March 24, 2000

Winner- "Downtown Office Development"

The Martin Group makes its mark with S.F. Landmark

By Steve Ginsburg

Sitting at the foot of Market Street and the Embarcadero, the aged Southern Pacific Railroad headquarters building had an amazing Bay view location but was underutilized for nearly a decade. It took $120 million — and a lot of guts by The Martin Group — to return it to its landmark status.

In hindsight, the success of the Landmark at One Market looks like a no-brainer, given the San Francisco real estate market's unquenchable thirst for space.

It didn't look that way in April 1998, when Martin purchased the building for $47.5 million with plans to extensively restore the classical 1917 structure. There was just one anchor tenant in San Francisco looking for 100,000 square feet of Class A space, law firm Thelen Martin.

Since then, the market has taken off on technology-fueled boom, leading to strong demand at rents averaging $55 a square foot. Scient Corp., who took 165,000 square feet, and Del Monte, who has over 100,000 square feet, will anchor the building. Martin Group was close to signing Microsoft to a 60,000 square-foot lease at press time. Tenants are due to move in later this summer after work on the lobby and elevators are being completed this spring.

Technology has played a large part in the building's history. For years, it housed the computers Southern Pacific used to control it's far-flung railroad network in the West. Martin's contractors began the restoration with SP's computers still operating, carefully avoiding cutting cables.

To meet seismic codes, Martin decided against unsightly exterior braces that would diminish the building's palazzo style architecture, opting for a complex internal brace housed in two huge tubes. Construction crews had to drill 165 feet into the Bay fill and place steel-reinforced concrete piers to anchor the brace. This heavy construction was accomplished without damaging the exterior of the 360,000 square foot building that is topped by a colonnade. A light will shine on the colonnade at night as Covarrubias is hoping to turn the building into a landmark that can be seen from the East Bay.