The value of San Francisco office buildings sold in the third quarter fell 24 percent as potential buyers found it more difficult and costly to borrow money.

Sixteen office sales totaling $447.5 million were completed, compared with 13 transactions with a combined value of $591.3 million a year earlier, according to data compiled by Grubb & Ellis.

“Financing is slow moving, less liquid and more expensive,” said Marc Sznajderman, managing director of Carlton Advisory Services, a real estate investment banking firm. “New deals that were in the market were either pulled or put on hold, and prices were negotiated down.”

Commercial mortgage rates have climbed after defaults on subprime home loans prompted lenders to tighten all forms of credit. The cost of financing commercial deals has risen 1 percentage point since the beginning of July, and cash-rich buyers are now in a better position to complete deals than firms relying on leveraged financing, Sznajderman said.”

General Electric’s Arden Realty, based in Los Angeles, bought Golden Gateway Commons from Blackstone Group for about $98 million in San Francisco’s biggest purchase of the quarter. A year ago, the three biggest deals were for $135 million, $125 million and $110 million, Grubb & Ellis said.

Other transactions in the quarter included: San Rafael-based Seagate Properties’ $67 million acquisition of 114 Sansome St. in a joint venture with Guggenheim Trust; Beverly Hills-based Kennedy Wilson’s purchase of 300 California St. for about $50 million; and Palo Alto-based Broadreach Capital Partners’ $44 million acquisition of 1390 Market St.

“The buyers have been private owners looking for upside in rehabilitating or re-tenanting buildings as opposed to institutional buyers,” said Jessica Brownell, research director for Grubb & Ellis, which counted only sales above $5 million.

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