2022 Bay Area halftime report: Silicon Valley, Peninsula rack up 1.6M sf of expansions

It’s halftime for the Bay Area’s commercial real estate market in 2022, a good time to take stock of the businesses that widened their footprints this year.

More companies are increasing their footprints by at least 50,000 square feet in Silicon Valley and the Peninsula than anywhere else in the Bay Area.

More than 1.6 million square feet of net expansion — the amount of space a business leased or subleased minus any space it plans to give up as part of that deal — involving 10 different businesses have taken place in the pair of adjoining regions this year. They stretch from Daly City on the north to San Jose on the south and include office and innovation hubs such as Sunnyvale’s Moffett Park, Palo Alto’s Stanford Research Park and South San Francisco’s 500-acre biotech cluster.

San Francisco, by comparison, recorded three such expansions over the first half of the year, representing roughly a quarter of that amount.

Despite almost one in three offices in Santa Clara being vacant at the end of the first quarter, the Silicon Valley city of 130,000 or so residents tied with San Francisco, which has a population more than six times greater, for the most in any single Bay Area city or town.

The largest among the deals in Santa Clara was Pure Storage’s sublease of about 330,000 square feet of offices from Analog Devices at 2555 and 2565 Augustine Drive. The provider of data storage devices and services is moving its corporate headquarters to Santa Clara from Mountain View, vacating 250,000 square feet in the process.

Companies increasing their office square footage made up 13 of the 18 expansions on The Real Deal’s list. Some involved a mix of office and another type of space, such as life science or research and development. One such example is Eikon Therapeutics’ 285,000-square-foot lease of office and life science property at the Alexandria Center for Life Sciences-Millbrae. The Hayward-based biotech firm will relocate its base to the center upon completion, a move that will almost quadruple its footprint.

San Francisco’s trio of expansions include the third-largest office lease in the Bay Area this year: Google Cloud’s 300,000-square-foot sublease from Stripe at 510 Townsend Street. It’s the city’s biggest new Covid-era office lease or sublease in terms of square footage. The deal will bring San Francisco’s second-quarter office leasing volume up to its historic average of 2.1 million square feet, according to the San Francisco Business Times.

The other two expansions were Twitter’s almost 80,000-square-foot lease to expand its headquarters at 1355 Market Street, and Iconiq Capital’s almost 89,000-square-foot sublease from Autodesk at 300 Mission Street. The latter deal will see Iconiq, a wealth management firm that serves the likes of Mark Zuckerberg, Sheryl Sandberg and Jack Dorsey, shift its base to Mission Street in the city’s Financial District from 394 Pacific Street in Jackson Square, according to the Business Times. The move will almost double its footprint in the city.

The Real Deal’s data collection effort relied primarily on recent reporting, but some deals might be missing from the above map graphic. There will be one more report with interactive maps to follow. Please contact Matt Niksa at matthew.niksa@therealdeal.com if you have any suggested additions or edits.

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Alexandria leases 285K sf at new Millbrae campus to Eikon Therapeutics