\State of California to Trim San Francisco Office Portfolio

The California Public Utilities Commission might be moving out of its longtime home in San Francisco.

The California Department of General Services floated moving the commission’s staff from the Governor Edmund G. “Pat” Brown Building at 505 Van Ness Avenue to the nearby Ronald M. George State Office Complex at 455 Golden Gate Avenue, the San Francisco Business Times reported.

If the utilities commission decamps from the Pat Brown Building, the state could opt to sell the building, though other options have also been studied. A plan to renovate the building was rejected because of its projected cost of $880 million. The Ronald M. George Complex currently houses courtrooms, including the California Supreme Court.

The Department of General Services’ recommendations to move staff comes after a review of the state’s office portfolio, which is done every two years to identify places to save money. The post-pandemic proliferation of remote work prompted the state to clamp down further on owning excessive space at the risk of spending money unnecessarily.

Some buildings under the Department of General Services’ control are already on the sales block. Some of them are poised for transformation into housing. As for the RMG Complex, it could likely be headed to a renovation, though the government didn’t disclose a cost estimate for such a project. The future of the Pat Brown Building remains uncertain, as the utility commission is the sole tenant at the property.

The state’s office needs in San Francisco are projected to drop by up to 30 percent. With direct asking rents in San Francisco at $69 per square foot compared to a $36 average across the country, it appears more likely that employees will consolidate into the RMG Complex. If the Pat Brown Building is deemed to be surplus property, it could be converted into housing, similar to other state office-to-residential projects in San Diego, Fresno and San Jose.

— Chris Malone Méndez