Exclusive: IQHQ Sells Bay Area Costco Business Center

IQHQ has sold a 113,828-square-foot Costco Business Center in South San Francisco to SAFCO Capital, according to Yardi Matrix information. SAFCO Capital paid $32.8 million for the retail asset, or $288 per square foot.

Located at 900 Dubuque Ave., the property came online in 1957 on nearly 8 acres, just off U.S. 101 and less than 10 miles from San Francisco. It underwent renovations in 2017. Prior to the sale closing, Newmark had been marketing the asset as a rare triple-net opportunity.

The deal marks a partial pullback from an area where IQHQ had been assembling multiple properties for a potential life science campus since 2020. IQHQ had acquired the Costco Business Center in 2021 from Allied District Properties. Newmark arranged that $29.8 million deal.

The same year, IQHQ purchased the adjacent property at 800 Dubuque Ave., which the firm, primarily focused on lab and research space, redeveloped into the 112,912-square-foot South San Francisco Business Center.

In 2024, SF YIMBY reported that IQHQ was looking for a 10-year extension for its entitlements on its wider project at 800-890 Dubuque Ave, where the firm is planning a three-building life science campus with development costs estimated at $1.3 billion. Plans for the project dubbed Spur District included, at the time, 857,000 square feet of office space across six-, nine- and 10-story buildings. Perkins+Will served as the project architect. Full completion was expected at the time by 2039.

While the Costco Business Center that just sold was not part of the initial plans approved for Spur District, the transaction underlines IQHQ’s realignment in the immediate area. Commercial Property Executive reached out to the developer for additional information, but received no immediate comments.

Life science slowdown persists

IQHQ’s hold strategy in South San Francisco comes at a time when life science real estate is recording waning demand and rising vacancies nationwide, with more than 55 percent of space delivered between 2020 and 2025 still vacant, according to Savills. As of April, 73.4 percent of last year’s deliveries were still available for leasing.

The first quarter of 2026 showed slower momentum for the segment, as vacancy climbed above 20 percent in several major markets. Multiple recently completed projects lacked preleasing commitments—one such example cited by Savills is IQHQ’s 800 Pacific Coast Highway in San Diego.