AI Giant Anthropic Expands San Francisco Headquarters

Anthropic is beefing up its downtown San Francisco headquarters.

The artificial intelligence giant, hot off raising $13 billion in investments this month, leased several floors of office space at the Foundry Square III building, the San Francisco Chronicle reported. The company is taking about 100,000 square feet, almost a third of the 10-story building.

The building at 505 Howard Street spans more than 300,000 square feet and is across the street from Anthropic’s current headquarters at Foundry Square IV. Anthropic subleased more than 230,000 square feet in that building from Slack, which shifted to a remote-first work model after the pandemic. That deal was one of the largest local transactions in years, though it was outdone by competitor OpenAI, which leased buildings spanning nearly 1 million square feet for its headquarters in Mission Bay.

Terms of Anthropic’s headquarters lease, including how long the company will be in the space, were not disclosed, though reportedly both the new lease and the sublease expire in 2028.

The 505 Howard building’s other tenants include accounting juggernaut KPMG, which leased 100,000 square feet in the building a year ago after it chose not renew its lease at its longtime headquarters on Second Street. Intuit also moved into 505 Howard recently, exiting an office on Fourth Street that it occupied for a decade. KPMG and Intuit downsized in their moves to 505 Howard.

As San Francisco battles high post-pandemic office vacancy and slow-but-steady return to work, other companies have similarly signed on to less space than they previously occupied. Office vacancy is at 34.6 percent, down from a peak of 36.9 percent in the third quarter of last year, according to CBRE.

The AI sector is expected to revive the city — and its office market — with an influx of workers over the next five years. By 2030, more than 50,000 AI workers are predicted to flock to San Francisco, while AI firms’ office space inventory is expected to balloon from 5 million to more than 20 million square feet, cutting the city’s vacancy rate in half, per CBRE.

— Chris Malone Méndez