Boston Properties to Buy Embarcadero Center

Mortimer Zuckerman’s Boston Properties Inc. has won the high-stakes contest for San Francisco’s giant Embarcadero Center office and retail complex, agreeing to pay $1.22 billion for one of the West Coast’s premier properties. David Rockefeller and Prudential Insurance Co. of America sold the center--which combines four office towers and shopping center space in the financial district--for about 20% more than the going rate for trophy properties in the city. The purchase is Boston Properties’ first venture into the West Coast office market. The company vied with about two dozen bidders before beating out rival Equity Office Properties Trust. Under the agreement, Rockefeller and Prudential will receive $305 million in convertible preferred securities of Boston Properties. Other terms were not disclosed. Zuckerman, a Boston-based real estate and publishing magnate, said the property will be a “flagship” on the West Coast for his company, which to date has operated mainly in and around Boston, New York and Washington. Boston Properties’ shares fell 31 cents to close at $33.13 on the New York Stock Exchange. In all, Embarcadero Center contains 3.4 million square feet of office space in four towers and two smaller buildings, 354,000 square feet of retail space and 2,090 parking spaces under the buildings. It’s the largest property of its kind in the West.