After nearly half a century in local hands, Shorenstein Properties has quietly given up control of 45 Fremont, the 34-story Financial District tower the family developed in 1978. The property transferred in January 2026 in a lender-facilitated short sale, marking yet another trophy office tower slipping out of San Francisco ownership as downtown’s skyline gets financially reshuffled. The building sits a block from the Salesforce Transit Center and has hosted marquee tenants from Bechtel to Wells Fargo over the years.
New York investor Madison Capital is now in charge and is pitching a full refresh to lure tenants into a soft market. According to Madison Capital, the firm closed on 45 Fremont in January and is planning an amenity-focused overhaul with a new conference center, updated fitness facilities and tenant lounges. The company says it is preparing spec suites and other lease-ready space as part of a broader building reintroduction for the 606,165-square-foot, LEED-certified tower, which currently has about 213,000 square feet sitting vacant.
The shift in control followed a period in which lenders effectively took the wheel. The San Francisco Standard reports that Madison bought the distressed debt tied to 45 Fremont for roughly $238 million, and that the property then changed hands via a deed-in-lieu transaction after the owners defaulted on a 2019 mortgage. That arrangement ended Shorenstein’s nearly five-decade run as steward of the tower.
Some of the building’s financial troubles track back to a splashy lease inked just before the pandemic era. In 2019, Slack signed on for roughly 205,000 square feet at 45 Fremont. The deal never turned into the long-term income stream the owners were hoping for after Salesforce acquired Slack in a $27.7 billion transaction and those floors later hit the market as sublease space. The San Francisco Chronicle and other local outlets have cited Slack’s sublease shift as a key drag on the tower’s cash flow.
Madison Capital’s play at 45 Fremont fits a pattern. The firm also took control of debt at 123 Mission Street in March and has been scooping up distressed notes and loans around the city, positioning itself to convert lender paper into property ownership. Industry coverage from The Real Deal details Madison’s 123 Mission purchase and its plans to pursue repositioning strategies there as well.
Behind the scenes, lenders have been routing rent and building income toward shoring up at-risk mortgages as traditional refinancing options dry up, and bank-directed listings have become a regular feature of the market. Green Street and local reporting note that Eastdil Secured was marketing 45 Fremont at the direction of Bank of America, and that buyers’ fortunes will hinge on how quickly they can fill the vacant floors.
How a deed in lieu works
A deed-in-lieu of foreclosure is a voluntary move in which a borrower transfers ownership of a property to a lender to settle a defaulted loan and sidestep a drawn-out foreclosure process. Regulators and standard industry guidance describe it as a tool often used when the outstanding loan balance is higher than what the property would likely fetch in the current market. The New York Department of Financial Services notes that lenders typically favor a deed-in-lieu when there are no junior liens on the property and both sides want a faster, more private resolution than a courtroom fight.
As for the players in this particular handover, Shorenstein declined to comment, according to the Standard. Madison Capital, for its part, has signaled a leasing-first strategy for 45 Fremont. The San Francisco Standard reports that the deal is one piece of a larger wave of lender-driven trades now being closely watched as San Francisco’s office market re-prices in real time.
