Occupancy at 221 Main Jumps to Nearly 100% in Two Years
Underpinning the success of 221 Main St.’s leasing program are a series of strategic enhancements which culminated last year in an extensive renovation of the building’s outdoor terrace.
SAN FRANCISCO—Office tenants’ appetites for space continues to climb in this competitive landscape. This is certainly true of the Financial District, which remains in demand by tech and other financial tenants.
In less than a year, Columbia Property Trust Inc. has completed more than 100,000 square feet of leasing transactions at 221 Main St., a class-A office tower located in the South Financial District. In fact, a combination of tenant expansions and new leases signed during the past 22 months have driven the building’s overall occupancy rate to 98%.
“We have continued to maintain very high occupancy at 221 Main St. and throughout our West Coast portfolio, while also maintaining robust leasing spreads,” said Nelson Mills, president and CEO of Columbia Property Trust. “Thanks to our local team’s dedication and creativity, and our well-positioned portfolio, we have been able to consistently create value for our shareholders while also fulfilling the needs of our existing and new tenants in a very competitive market.”
Among the most recent deals, cloud-based network firm Tradeshift signed a new lease for 24,000 square feet on the second floor of the building in February. Tradeshift joins a strong roster of other technology tenants in the tower, including digital transaction management company DocuSign, which expanded its headquarters early last year into a total of 145,000 square feet, making it the anchor tenant at the building. Peer-to-peer lender Prosper Marketplace also has its headquarters and a substantial presence at the property.
“Today’s creative tenants expect fully modernized office towers that feature dedicated amenity spaces where they can collaborate, socialize or work remotely in a vibrant and inspiring setting,” said David Dowdney, who oversees Columbia’s portfolio in the western region as head of leasing for the company. “We have invested strategically in high-impact amenities at 221 Main St. that deliver these types of spaces and the level of service our tenants need, to reaffirm this unique building’s status as best-in-class in this highly competitive office market. The continuing and expanding commitment to the building by leading tech companies and other valued tenants clearly demonstrates the success of that strategy.”
Underpinning the success of 221 Main St.’s leasing program are a series of strategic enhancements which culminated last year in an extensive renovation of the building’s outdoor terrace, located on the expansive setback at the tower’s fourth floor. The 11,000-square-foot terrace now joins the ranks of the growing number of outdoor spaces in the area.
“221 Main St. is located in one of San Francisco’s most appealing live/work/play districts, and the nascent Transbay Transit Center is in close proximity and its public park is expected to reopen immediately across the street from 221 Main in the near future,” Dowdney tells GlobeSt.com. “The area also continues to benefit from a growing number of new high-end residential and retail developments.”
Columbia acquired 221 Main St. in 2014 and quickly leased all available space at the building. To ensure a steadily rising trajectory of demand ahead of future lease roll, Columbia embarked on a renovation program of the 16-story tower, built in 1974. In addition to the reimagined and upgraded terrace, the program has included several other projects completed or introduced since 2017: the construction of a new conference center and tenant lounge, updates to the building’s LED entrance display and the launch of an onsite lifestyle concierge service.
“To be sure, we didn’t lease up the space in 221 Main Street overnight,” Dowdney tells GlobeSt.com. “The process was actually more involved. First, we worked with several smaller office tenants in the building to help them consolidate and/or relocate in order to create larger contiguous blocks of space. Once these larger spaces were created, DocuSign, the largest tenant at 221 Main St., successfully expanded their headquarters space within the building.”
The Bay Area remains the strongest major US office market with the highest average asking rates, according to a report by Colliers International. Vacancy as of fourth quarter 2018 clocked in at an extremely tight 4.5%. Tech and Internet giants continue to pre-lease large blocks of space and demand exists for several million square feet more.