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SAN FRANCISCO-The locally based law firm Phillips, Spallas & Fotouhi LLP is relocating its headquarters from 5,600 sf in 100 The Embarcadero to 15,130 sf on the 10th floor of 650 California Street. The move is expected to occur in a few weeks.

Phillips, Spallas & Fotouhi specializes in civil litigation defense work throughout California and Nevada with offices in San Francisco, San Luis Obispo, Fresno and Las Vegas. The firm is subleasing the space from the investment bank Jefferies & Co.

Christopher Roeder, the Director with Cushman & Wakefield who represented the law firm tells GlobeSt.com it was looking to expand and upgrade with as little out-of-pocket expenses as possible. “They were looking at a very specific group of buildings that appealed to the partners, and the (Jefferies & Co.) space was in perfect condition for a law firm,” says Roeder. “They just needed to make some changes to the finishes and the reception area.”

Roeder declined to provide the specifics of the transaction, but local brokers familiar with the lease say the law firm will be paying an average rate of about $25 per sf per year including several months of free rent to offset the time remaining on their existing lease. The rate is between 20% and 30% lower than space being marketed directly by the building owner, the Phoenix-based Pivotal Group. The term of the sublease is about five-and-a-half years.

Law firms are one of the most active users in the San Francisco office leasing market, currently accounting for approximately 25% of active requirements, according to commercial real estate services firm Cushman & Wakefield. “A majority of the activity out there is law firms and other professional services firms,” says Roeder, “many of which are looking to trade up their space into better quality space and better quality buildings while remaining in the CBD and within walking distance of BART.”

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