The Salesforce liposuction of its San Francisco office portfolio has now cut into its signature Salesforce Tower in South of Market.
The management software firm, which has shed offices in step with a 10-percent layoff of its workforce, has listed six floors for sublease at its corporate headquarters at 415 Mission Street, the city’s tallest building, the San Francisco Business Times reported.
The move by the city’s largest employer means downsizing the 875,000 square feet it now occupies in the 61-story tower by 125,000 square feet, a 14-percent reduction in space.
Boston Properties owns the fully leased tower, which has 1.41 million rentable square feet. The Salesforce sublease listing is marketed by CBRE.
The sublease brings the volume of offices Salesforce is shedding in San Francisco to more than 1 million square feet during the new era of remote work.
“This is part of what we announced in January,” an unidentified Salesforce spokesperson told the Business Times in an email, referring to a cost-cutting move.
Salesforce said then it expected to incur $450 million to $650 million in charges associated with real estate office reductions.
Slack, a workplace messaging software company owned by Salesforce, said last month it would move its 250,000-square-foot SoMa headquarters into the Salesforce Tower, but declined to say how much space it would take. In February 2022, Slack listed for sublease 200,000 square feet at 45 Fremont Street.
In July, Salesforce put more than 400,000 square feet of office space, about half of its 43-story Salesforce West tower at 50 Fremont Street in the Financial District, up for lease. That marked its third office cut since the pandemic.
The cloud-based software firm bought 50 Fremont in 2015 for $638 million, before Salesforce Tower was built across the street. It employs 10,000 workers in the city, who have been allowed to permanently work from home part of the week.
In March 2021, it subleased 339,000 square feet, or half of the 30-story Salesforce East tower at 350 Mission Street owned by Kilroy Realty, to Yelp and Sephora. At the same time, it canceled its 325,000-square-foot lease at the unbuilt Parcel F tower.
In March 2020, Salesforce bought 450 Mission Street, a five-story office building across the street from Salesforce Tower, for $145 million. It still owns the property, and the company doesn’t occupy space there.
The office vacancy in San Francisco is nearly 28 percent, according to CBRE, which has put the city on a national watchlist as “the most empty downtown in America.”
— Dana Bartholomew
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