Salesforce Giving Up 350K SF In Downtown S.F. In Latest Blow To City's Office Market
This is the third such cut to Salesforce's office space in the Bay Area in the last 18 months. The sublease amounts to 40% of the Salesforce West building, which the company purchased in 2015 for $637M, according to the San Francisco Chronicle.
“Salesforce offices are an important part of our culture, and how we use them has evolved. We are subleasing floors in Salesforce West to make the most efficient use of our real estate footprint. We will maintain ownership of the building and can reoccupy the space as needed over time. As the largest private employer in San Francisco, we are deeply committed to the city and are actively welcoming employees back to Salesforce Tower,” the company told the San Francisco Chronicle.
Salesforce co-founder and co-CEO Marc Benioff has been adamant that back-to-office policies are ineffective, stating “office mandates are never going to work,” when speaking at a company event in June, according to Yahoo Finance.
The company has been heavily pushing remote work initiatives for its employees, permanently allowing most of its staff to work remotely earlier this year, according to the San Francisco Chronicle.
SF YIMBY today reported that Cushman & Wakefield will handle leasing for the space.
Office vacancy in San Francisco hovered at the 20% mark in the second quarter of this year, according to the latest data from Transwestern's San Francisco office.
Transwestern's second-quarter office report noted that negative net absorption increased by 118.4% since last year. Transwestern Senior Research Manager George Entis told Bisnow earlier this month that the office space in San Francisco that has become vacant since 2020 is equal to “seven and a half Salesforce Towers.”
Additionally, layoffs within San Francisco’s tech industry mount, despite the overall low unemployment in the city. Several big-name companies such as Tesla, Twitter, Coinbase and PayPal have cut staff in recent months.