Roblox subleases larger headquarters in San Mateo

Roblox, the popular online gaming company, is dumping its 80,000-square-foot headquarters in San Mateo for a new headquarters in the same city with more than twice the space, according to documents filed with the Securities & Exchange Commission.

Roblox has agreed to sublease a 180,000-square-foot building at Bay Meadows on 2850 South Delaware Street. The former occupant of the building was the software company Guidewire. Roblox has agreed to a term of seven years and will pay approximately $90 million through December 2029. Roblox’s decision to move to a larger building goes against current trends in the market.

“Tenants continue to ‘right-size’ into smaller space and look for shorter term leases as they weigh the impact of work from home,” a fourth quarter report by Kidder Mathews said. 

Two of the buildings at Bay Meadows are still under construction and the larger 218,000-square-foot structure is now 100 percent pre-leased to Roblox. 

In a separate SEC filing, Guidewire disclosed it will move its headquarters to Roblox’s former 80,000-square-foot office building at 970 Park Place. The term of this agreement is four years and Guidewire will pay approximately $22 million in rent through the duration of the lease. 

In total there are five buildings at Bay Meadows totaling 733,000 square feet, with Building 1 and Building 5 still under construction. The office buildings are part of a larger 83-acre transit-oriented development that will feature residential and retail projects. Other tenants at Bay Meadows include Snowflake, Wilson Meany and Stickbridge.

The subleases by Roblox and Guidewire provide some needed activity in the Peninsula office market that stagnated in the fourth quarter of 2022. There were 207,000 square feet of space leased last quarter, down 72 percent year over year, according to the Kidder Mathews report. The state of office sales was even bleaker, down 94 percent from 1.5 million square feet in the final quarter of 2021 to 99,000 square feet last quarter.

Stonebridge Capital’s 14,400- square-foot lease was the largest lease transaction in the Peninsula of last quarter, followed by Alexandria Real Estate’s 13,600 square foot lease in South San Francisco.