Sources: Apple agrees to rent 75K square feet of office space in San Francisco's SoMa, in first big push into the city
Cory Weinberg / bizjournals :
Context & Ripple Effects
The SoMa deal is the odd one out in a year of Apple real-estate moves that all pointed the other way. Weeks earlier the company signed a 300K-square-foot north San Jose campus on the former Atmel headquarters site, added 260K square feet in Cupertino near Campus 2, and was reported to be lining up the 777K-square-foot Central and Wolfe project in Sunnyvale — a buildout concentrated almost entirely in the South Bay.
Taking 75K square feet in SoMa is small by that yardstick, but it is the company's first major entry into San Francisco itself, extending the footprint from owned-and-built suburban campuses toward a rented urban outpost.
First-order effects
- SoMa landlords gain a tenant with Apple-scale credit at a time when most of its leasing dollars have been flowing to San Jose, Sunnyvale, and Cupertino instead.
Second-order effects
- South Bay landlords courting Apple — including whoever lands the Central and Wolfe lease — now compete with a city option inside the same corporate portfolio, giving Apple leverage across both markets.
Third-order effects
- If the pattern holds, large Peninsula companies stop treating San Francisco as a satellite market and split their growth between suburban campuses they own and urban space they rent — reshaping demand in both office markets.
The trend: Apple's 2015 real-estate spree is expanding from owned suburban campuses in the South Bay into rented urban space, marking its first serious presence in San Francisco proper.