When San Francisco real estate professionals say the post-pandemic office market takes one step forward and two steps back, they are referring to moments like this: Homegrown tech giant Airbnb Inc. put an entire 150,000-square-foot office building in SoMa up for sublease.
The building at 999 Brannan St., which is owned and was previously occupied by Dolby Laboratories Inc. (NYSE:DLB), is available on a sublease basis through June 2026. Airbnb (NASDAQ: ABNB) has occupied it for almost six years.
The listing, the latest step in the short-term rental company’s effort to downsize its San Francisco campus, comes as no surprise. In the spring, CEO Brian Chesky committed to a fully remote workplace, announcing that the company’s employees will have the freedom to live and work anywhere around the world.
“We made changes to our office footprint to reflect our approach to allow employees to live and work anywhere, but San Francisco remains our home and 888 Brannan will continue to serve as our global headquarters,” a spokesperson said in an email.
The company continues to lease its 280,000-square-foot headquarters building at 888 Brannan St., where sources say its lease expires in 2023.
Airbnb said in a second quarter letter to shareholders that its restructuring charges included $89 million for lease assets related to office space deemed no longer necessary as a result of its “Live and Work Anywhere” policy. It said it does not expect substantial restructuring charges “for the foreseeable future.”
In an August filing with the U.S. Securities and Exchange Commission, the company said its worldwide restructuring plan included a “25% reduction in the number of full-time employees, or approximately 1,800 employees, as well as a reduction in the contingent workforce and amendments to certain commercial agreements.”
Airbnb has now officially parted with four of the five offices it once occupied in the Showplace Square area of SoMa. Last May, the company made headlines when it listed close to 290,000 square feet at 650 Townsend St., which once served as game-maker Zynga Inc.’s headquarters. Zynga owned the building until 2019, when Zynga sold it to Beacon Capital Partners in a lease-back deal. At the time, Airbnb said last year that it took a $113 million charge related to unneeded office space in San Francisco.
In June 2020, the company also listed for space at two other Showplace Square buildings for sublease: 78,565 square feet at 650 Seventh St. and 61,455 square feet at 808 Brannan St.
Airbnb did not respond to inquiries on Wednesday about whether it has found subtenants for any of its listings.
San Francisco’s office vacancy reached 22.4% in the second quarter of 2022. According to research provided by real estate firm Colliers, the city’s overall sublease availability has remained at around 8 million square feet for the past year after peaking at nearly 10 million square feet in early 2021.
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