Software firm subleases 100K sf in Pleasanton office park

Dublin-based software company Vagaro has leased more than 100,000 square feet of office space at the Rosewood Commons Office Park in Pleasanton, according to a release by CBRE. The deal qualifies as the second-largest new lease in the East Bay last quarter, second only to cloud data storage company Snowflake leasing a 153,004-square-foot building in Dublin.

Vagaro is taking over 106,017 square feet at 4400 Rosewood Drive. The building is equipped with an on-site conference room, an auditorium, loading areas and on-site property management.

Rosewood Commons, which has more than 1 million square feet, has prioritized providing an experience for their tenants with on-site amenities. The property has a centralized cafe, outdoor space to play sports during breaks, and a fitness center. Some of the tenants at Rosewood Commons include Farmers Insurance and Allergan. The financial terms of the lease were not disclosed.

The strategy of Rosewood Commons follows the trend of flight to quality where companies seek office space with amenities to lure employees who prefer remote work to the office. According to a second-quarter report by JLL, Class A buildings total about 30 million square feet in the East Bay office market, or 5 million more square feet than Class B buildings. Class A addresses also drive 50 cents more in asking leases at $3.91.

Companies can secure Class A office space, as the East Bay has a 20 percent vacancy rate for such high-quality space. According to the report, the vacancy rate is largely driven by Bay Area employees lagging behind other markets in returning to the office. The report expects the vacancy to drop because of some large deals currently in negotiation.

“Multiple large-block leases are set to commence later this year, and with more large block deals in the pipeline, occupancy gains are anticipated in the East Bay suburbs,” the report said.

With Class A in demand, real estate players have raced to acquire it. Oakland based-California Capital bought a 135,000-square-foot Class A office building for $38.5 million in Pleasant Hill weeks after acquiring a similar style building in Walnut Creek for $49 million. On the lease side, UC San Francisco is looking for 150,000 square feet of office space in downtown Oakland, and could settle on 601 or 555 Center.

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