Visa to Sublease 190 KSF in San Francisco

Mission Rock. Rendering courtesy of Tishman Speyer and San Francisco Giants

Visa has listed for sublease its entire 190,000-square-foot San Francisco headquarters at One Market Plaza.

The company is set to relocate and expand its presence within the city’s Mission Rock neighborhood in Mission Bay, a 1.4 million-square-foot megaproject slated to open its first phase in mid-2024. Tishman Speyer and San Francisco Giants are behind the development.

Visa’s sublease agreement at One Market Plaza is among the largest in the city. The property comprises two towers with a combined area of nearly 1.6 million square feet and an occupancy rate of 96.6 percent, generating $151.7 million in annual office rent and $2.8 million in annual retail and restaurant rent, according to the filings of Paramount, the building’s owner.

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Despite not being driven by the same factors that have contributed to San Francisco’s office vacancy reaching a record high of 29.4 percent in March 2023, as reported by CBRE, the listing will further increase the already substantial amount of vacant space in the city’s central business district.

Visa’s sublease sends ripples through San Francisco’s office market

The impact of office vacancies in the city is expected to go beyond the financial burden on owners. According to city officials, vacant office buildings could have a considerable effect on the local budget, leading to an anticipated loss of nearly $200 million in property taxes each year by 2028.

Visa’s sublease offering will increase the available space in the building, causing a 16.4 percent rise in the vacancy rate, according to the same source. Apart from Visa, technology company Autodesk, has also put up approximately 73,000 square feet of space for sublease due to flexible work arrangements.

Visa’s upcoming new headquarters, slated to open early next year, will cover an area of 300,000 square feet, providing space for 1,500 employees compared to the current location at One Market Plaza, which houses only 650 employees, as revealed by the San Francisco Chronicle.

The company is also reportedly shutting down its Palo Alto offices and making its entire 64,000-square-foot building, located at 385 Sherman Ave., available for sublease, as stated in prior reports by The Registry.