2022 halftime report for Bay Area commercial: Silicon Valley runs up score as San Francisco sees shrinkage
SF sees most headquarters moves, while San Jose gains pair of new companies
San Francisco leads the pack in terms of Bay Area companies that have relocated headquarters of at least 50,000 square feet in size — five altogether, with three shifting to smaller offices within the city. San Jose, meantime, will be home to at least two new companies by the end of the year and perhaps another large one in 2023.
It’s halftime for the Bay Area’s commercial real estate market, a good time to take stock of all the businesses that moved their headquarters this year, a group you can track on the interactive map that follows. The Real Deal found that almost a dozen companies have shifted their bases to new digs across the region. Nine of them signed new leases as part of those moves, representing almost 1.5 million square feet, while the other two — Splunk and 23andMe — consolidated their footprints in buildings they already rented.
Procept BioRobotics and Allay Therapeutics are setting up shop in the northern part of San Jose, which appears to be on a path to becoming Silicon Valley’s downtown. Procept signed a lease on the last day of 2021 to rent more than half of a four-building campus at 150-180 Baytech Drive, representing about 158,000 square feet. Its lease term will commence by Dec. 31 and run for 122 months. The maker of surgical robots will exit a 48,400-square-foot space in Redwood City as part of its move.
Allay, meantime, is the second tenant to sign on to a life science conversion project on one side of Zanker Road between East Trimble and East Plumeria roads. In January, the startup told The Real Deal that it leased 50,000 square feet within one of the project’s seven buildings. It will relocate existing operations from a 10,000-square-foot space within a medical device incubator in Menlo Park and from some offices and labs it’s subleasing in Fremont. It said in a news release that it plans to finish building out the labs at its new San Jose base this fall.
Computer mouse maker Logitech, meantime, could be joining Procept and Allay in moving to San Jose, albeit next year.
The Switzerland-based company keeps its U.S. headquarters in a 158,000-square-foot building in Newark in the East Bay, but it signed a lease in late June on an 86,243-square-foot office and research facility in North San Jose. Its entire Newark base is available for lease on a direct basis. A Logitech spokesperson didn’t respond to The Real Deal’s request for comment, so it remains to be seen whether the company ends up renewing in Newark or moving its operations south to San Jose.
In San Francisco, Splunk is exiting its 215,000-square-foot home at 270 Brannan Street and shifting its employees to a 100,000-square-foot building next door in which it’s been a longtime tenant. The move will shrink the data analytics company’s footprint in the city by more than half. SF-based law firm Farella Braun + Martel also is downsizing as part of its headquarters moves, while Iconiq Capital is almost doubling its footprint there after subleasing almost 89,000 square feet from Autodesk.
The net change in footprint among the companies that have moved their headquarters or disclosed plans to do so this year is roughly 199,000 square feet, but that comes with a caveat: The Real Deal couldn’t track down the size of the old headquarters of Ripple, which leased a 130,000-square-foot building in a likely expansion near San Francisco’s Embarcadero in May to serve as its new base, or the square footage of Allay’s former digs in Fremont. Neither company’s move was factored into its calculations.
However, it’s safe to assume the net change in footprint over the entire Bay Area, factoring those two companies in, would still have been positive. Blockchain specialist Ripple and Allay previously shared their HQ addresses with other businesses and are moving into buildings in which they’ll be either the anchor or the sole tenants.
The Real Deal’s data collection effort relied primarily on recent reporting, but there might be some deals missing from the above map graphic. There will be several more reports with interactive maps to follow. Please contact Matt Niksa at email@example.com if you have any suggested additions or edits to it.