Levi Renews 400,000-SF Lease, Buys 73 Stores

The 838,000-square-foot building is owned by Gerson Bakar and Assoc., which retains Interland Jalson as the third-party property manager. Levi Strauss spent a year looking at its options but ultimately opted to stay put. Lease terms were not disclosed by either party and were not immediately otherwise available. A Gerson Bakar executive was not immediately available Monday for comment.

To help keep the company in the city the Mayor's Office of Economic and Development helped identify workforce training funds and sales and income tax credits available through state programs. In addition, the San Francisco Municipal Transportation Agency is looking at adjusting bus and rail schedules to better accommodate the company's 1,200 employees at the site.

A source with Levi told GlobeSt.com this time last year that the company has been out of the market for several years and that it would examine its options, stating that company policies require competitive bidding on all of its contracts. The Staubach Co. (now Jones Lang LaSalle), which was hired to assist with the work, sent out RFPs on behalf of Levi for 300,000 square feet of office space. While substantially less than it currently leases, 300,000 square feet was not believed to be a whole lot less than the company currently occupies, as it subleases a portion of its space.

Also Monday, Levi Strauss announced that it has completed its previously announced acquisition of 73 Levi's and Dockers outlet stores for $72 million. The stores were called "Levi's Outlets by MOST" and "Dockers Outlets by MOST." They were licensed to Anchor Blue Retail Group Inc., which sold its assets under Section 363 of the US Bankruptcy Code. The stores will now be upgraded and operated directly by Levi Strauss.

"Operating these stores directly is a great opportunity to strengthen and grow our brands over the long term," Levi Strauss Americas president Robert Hanson says in a prepared statement. "These stores complement our existing retail distribution both in wholesale and in our company-operated stores."