Tuesday, July 16, 2024

Google Renews Office in SF’s SoMA, But Cuts Footprint

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Google has renewed its lease for offices in San Francisco, but for less than half the space it previously occupied in South of Market.

The Mountain View-based tech firm has re-upped its lease for 64,000 square feet at 215 Fremont Street, the San Francisco Chronicle reported, citing unidentified sources. Terms of the deal with landlord Clarion Partners were not disclosed.

That’s 45 percent of the 140,000 square feet of offices leased by the search giant there in 2019.

The downsized lease comes a couple of months after Google announced it would vacate its 300,000-square-foot office at One Market Plaza at 1 Market Street, on the Embarcadero.

The tech behemoth has been slashing jobs and cutting costs, with multiple rounds of layoffs this year, including at 215 Fremont Street and nearby offices, according to the Chronicle.

Even with the cuts, Google still leases San Francisco offices at the Ferry Building, the One Market Landmark Building, One Maritime Plaza and Hills Plaza.

In May, an unidentified Google spokesperson said “we’re focused on investing in real estate efficiently to meet the current and future needs of our hybrid workforce. We remain committed to our long-term presence in San Francisco.”

Charles Schwab, which moved its eight-story headquarters from San Francisco to Texas in 2021, was previously the longtime tenant at 215 Fremont Street. 

The firm later subleased much of the 373,500-square-foot building to wearables company Fitbit, which helped pump up the building’s value during a 2019 sale to New York-based Clarion Partners for $335.5 million, or $898 per square foot. 

Google bought Fitbit in 2021, after Google had already leased offices at 215 Fremont Street. It’s not known if Fitbit still has offices in the building.

Since then, office values across San Francisco have plummeted, with one office building at 550 California Street trading for $114 per square foot.

Office vacancy in the city hit a record 36.8 percent in the second quarter, according to adjusted figures from CBRE. 

— Dana Bartholomew

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