One of downtown San Francisco’s older office buildings is being pushed to the brink, with a foreclosure auction now set for May 7 on a six-story property at 580 Market Street after its commercial mortgage-backed loan went into default.
The roughly century-old Class B building, long home to small retailers and creative office tenants, has been squeezed by falling occupancy and rising debt. With the loan in trouble and income dropping, lenders are now moving to sell, signaling yet another stress point for San Francisco’s already battered office core.
The auction date is tied to a roughly $15.7 million CMBS loan that went unpaid after it matured in June 2025, according to the San Francisco Business Journal. A notice of default filed late last year warned the borrower that a trustee’s sale could be next if the debt was not brought current, setting up this spring’s scheduled auction.
Servicer pushes for sale
Rialto Capital, acting as the special servicer on the troubled loan, took over servicing in February 2025 and is listed as the party pursuing foreclosure, The Real Deal reports. A notice of default filed in October pegged the outstanding balance at nearly $16.7 million, including fees and interest, according to servicer notes cited by industry trackers…