Salesforce To Exit Office Space, Slash Workforce 10%

Salesforce Inc. will cut its workforce by 10% and exit some of its office space, according to a filing with the Securities and Exchange Commission on Wednesday, though it didn't specify where or how much space it would give up.

As of the fourth quarter of 2022, the company's “non-cancelable minimum payments” for its office, data center and other space was about $4.4B, according to Salesforce, with payments of about $800M due during the next 12 months.

The company’s lease at the 875K SF, Boston Properties-owned Salesforce Tower in San Francisco runs through 2031. Salesforce put 350K SF up for sublease in its Salesforce West location in San Francisco last year.

The company represents roughly 3.5% of Boston Properties' annualized rental obligations, the largest share of any single company. Salesforce has locations worldwide, including offices in North America, Europe and Asia.

Salesforce CEO Marc Benioff said the current economic climate can't support the company's current size, which he admitted had grown too large.

“Our customers are taking a more measured approach to their purchasing decisions,” CEO Marc Benioff said in a letter to Salesforce employees. “With this in mind, we’ve made the very difficult decision to reduce our workforce by about 10 percent, mostly over the coming weeks.

"As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that,” Benioff wrote.

Saleforce estimates the actions will cost the company $1.4B to $2.1B, including $450M to $650M associated with office space reductions, with the rest related to letting go employees.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Why Top-Secret Facilities Are Permeating Greater D.C.'s Office Market

DivcoWest Sells Glendale Office Building For $70M

Inside The Nationwide Jockeying For Opportunity Zones 2.0

GTIS Partners Rebrands As Brightshore Capital, Launches $250M Debt Platform

Data Center Spills 5,000 Gallons Of Fuel Into New Jersey River

Hines And Rialto Close Office Credit Fund At $1.1B

Chipotle Adding Hundreds Of New Locations Worldwide

'Beyond A Routine Wobble': 10-Year Treasury Clears 5% Ahead Of Key Fed Meeting

Trump's DEI Crackdown Is Creating New Risks For Landlords That Lease To The Government

Rig Collapse At Citadel HQ Site Sends 4 To Hospital

Northern Virginia Office Tower Sells For Double Its 2024 Price

Airbnb Launches $250M Fund To Invest In Affordable Housing