San Francisco-based Trulia has ditched four floors at its six-floor headquarters in SoMa.
The online real estate marketplace, owned by Zillow, kept two of the six floors it occupied at 535 Mission Street in South of Market after its lease expired late last year, the San Francisco Business Times reported.
In 2014, Trulia became an anchor tenant at Boston Properties’ new 27-story highrise.
Boston Properties President Douglas Linde said during a fourth-quarter earnings call this week that its Trulia tenant had whittled down its offices. Terms of Trulia’s new lease aren’t known.
In early 2021, Trulia listed its entire 100,000-square-foot headquarters for sublease through Sept. 30, 2022, when its nine-year lease expired. The company was acquired by Zillow in 2015.
Boston’s Linde expressed “concerns” for the long-term viability of the San Francisco office market, which by one estimate is more than 27 percent vacant.
In the fourth quarter, Linde said that Boston Properties completed 200,000 square feet of lease deals. Of the total office deals completed across all of its markets, 48 percent came from new clients, 39 percent were renewals and 11 percent were expansions.
“Some of the renewing clients did reduce their footprint as part of the extension. Even in the midst of a slowdown in business activity and job reductions, there are still businesses that are expanding their footprint,” he said.
But Boston Properties did track three large space reductions that were made in tandem with lease renewals in the fourth quarter, Trulia’s downsizing being the most notable, he said.
Other San Francisco tech companies have made similar reductions when faced with expiring lease contracts in the era of remote work. They include software company DocuSign, trimming 57,000 square feet; architecture firm Gensler, trimming 10,000 square feet, and tech company Pinterest, trimming two floors.
“The West Coast is lagging in the return-to-office perspective and also from a leasing perspective, which is driven by the fact that there’s a much higher percentage of technology users in those markets and those users are not using their office to the same extent that other industries are,” Boston Properties CEO Owen Thomas said during the investor call. “And so far, they’ve led other industries in terms of layoffs, which impacts space use.”
— Dana Bartholomew