Prebys Foundation buys Wells Fargo Plaza tower to uplift downtown San Diego

A San Diego-based private foundation with more than a billion dollars in assets is putting its financial weight behind buoying the most troubled sector of the downtown real estate market.

On Friday, Prebys Foundation purchased the 24-story office building at 401 B St., better known as Wells Fargo Plaza, for $40 million from longtime owner Irvine Company in an all-cash deal, Grant Oliphant, CEO of the Prebys Foundation, told the Union-Tribune.

Irvine Company purchased the 488,000-square-foot building in 2004 for $148.3 million, according to information recorded with the county.

At the time of its sale, Wells Fargo Plaza was 75% leased. When including space being marketed for sublease, the building has 252,661 square feet of available space, according to data from real estate tracker CoStar.

The real estate acquisition, a first-of-its-kind buy for the philanthropic organization, is being framed as a business decision that doubles as an investment in the city’s struggling central business district.

“We really care about downtown,” Oliphant told the Union-Tribune. “We have a component of our investment philosophy … where we have said that we want all of our corpus to be invested in ways that are at least aligned with what we’re trying to make happen in the world. … The purchase of this building is the next step. We were looking at what was happening with downtown real estate and thinking, if we really do care about the fate of what’s happening in downtown, then maybe we ought to be a stakeholder.”

The foundation, Oliphant said, will make improvements to the building to not only boost tenancy but to enliven the B Street corridor, which has been depressed by record low office occupancy, fire sales and building foreclosures.

“We do expect (the property) to make money, and want it to make money,” he said. “We are looking at trying to be a presence in the continued rebirth of downtown, and we are able to be a player in that for the longer term. … We can be patient capital.”

Established in 2016 after the death of local developer Conrad Prebys, the private foundation is the philanthropic outgrowth of the Prebys estate. In 2021, the organization sold Prebys’ portfolio of 66 residential complexes to Blackstone Group for more than $1 billion, in a move said to help fuel its charitable gift giving.

Prebys Foundation ended 2023 with $1.13 billion in assets, according to the organization’s most recent Form 990 filed with the Internal Revenue Service. That same year the nonprofit doled out $53.7 million in grants and charitable gifts.

The foundation prioritizes making grants to advance health care, medical research, the arts and youth development.

The 501(c)(3) recently broadened its scope to include private equity financing. In February, the organization launched the Prebys Ventures Impact Fund with $50 million earmarked for early stage technology and life science startups in San Diego.

Built in 1985, Wells Fargo Plaza occupies an acre of land at B Street and Fifth Avenue. Irvine Company has renovated the building over the years, updating the conference center and outdoor workspace, and enhancing the fitness center with resort-style locker rooms.

The building was the longtime home of the region’s lead transportation agency, the San Diego Association of Governments, which just moved into its new headquarters at West. Current tenants include engineering consultant firms WSP and Kimley-Horn, financial consulting group CBIZ, Wells Fargo Bank and the Downtown San Diego Partnership.

“Following a competitive process that involved many potential buyers, we are pleased that the Prebys Foundation has purchased Wells Fargo Plaza,” Eastdil Secured Managing Director Adam Edwards, who represented Irvine Company, said in a statement to the Union-Tribune.

Prebys Foundation financed its purchase using cash reserves.

The buy is linked, in part, to the foundation’s work just a block away.

Last year, the foundation hired consultant U3 Advisors to dream up a big-picture vision for San Diego’s Civic Center blocks. The city had intended to offer the real estate for sale or lease until budgetary woes led Mayor Todd Gloria to call off the plan to secure a new City Hall. The U3 work is continuing despite the abrupt shift.

“I look at this as complementary to what could and might happen in Civic Center, but not necessarily dependent on it,” Oliphant said. “The initial vision (from U3) that emerged was for City Hall to stay where it is, to stay on the site. It’s untrue to say that a vision couldn’t work with the city remaining where it is, and the mayor and we have had that conversation. He has to figure out the very difficult finances of the city and current environment.”

Wells Fargo Plaza would seem to lend itself as a replacement to the aging City Administration Building, otherwise known as City Hall, especially since the city had been in talks with Irvine Company last year to buy the property. But Oliphant said he has not discussed tenancy with the city.

“That conversation hasn’t happened,” he said. “This building is an investment. So any tenants in the building, it has to work financially, and we’re looking at all possible tenants for that.”

The Wells Fargo Plaza transaction, valued at around $80 per square foot, sets a new baseline market value in the B Street corridor. The decline of the corridor, brought on by pandemic-era lockdowns and the ensuing shift in workplace dynamics, has been further punctuated by tenants in the market downsizing their space needs and seeking out amenity-rich properties closer to the water.

Office vacancy downtown has skyrocketed to 34.9% from 17.1% at the end of 2019, said Joshua Ohl, who is the senior director of market analytics for CoStar.

“Downtown San Diego’s vacancy rate has climbed to its highest level on record in 2025, more than doubling since the onset of the pandemic,” he said. “It’s probably closer to 50% when you factor in underutilized and vacant space that is not being marketed on the leasing market.”

The sale of Wells Fargo Plaza is part of Irvine Company’s newly stated strategy to focus on development opportunities farther north in University City, where the city’s newly approved community plan has laid the regulatory foundation for more than 30,000 additional residential units. The developer is putting more money into its office properties in the area as well. The company said last week that it will start construction this summer on a nearly $21 million reinvestment project at Eastgate, a 26-building campus on Eastgate Mall and Towne Centre Drive.

At the same time, Irvine Company is paring down its downtown holdings.

In September, the Southern California real estate giant sold Symphony Towers at 750 B St. for $45.7 million after more than two decades of ownership. A few months later, the company sold two more of its downtown office towers — at 101 W. Broadway and 225 Broadway — for a fraction of what it paid for the buildings.

Irvine Company remains the largest office landlord in San Diego with 70 office properties spread across University City, Del Mar, Sorrento Mesa, Mission Valley and downtown. Irvine Company’s San Diego portfolio also includes 15 apartment communities.

In downtown San Diego, the real estate behemoth stills owns One America Plaza at 600 W. Broadway and 501 W. Broadway.