"By expanding to 425 Market, we were able to take advantage ofthe building's large floor plate, [which is] perfect foraccommodating [our] training facilities," says Patrick Murray, CFOof Sephora. "And, clearly, the property's proximity to ourcorporate headquarters is a huge plus."

The lease, which commences this fall, backfills space vacatedearlier this year by San Francisco State University, which nowoperates out of Westfield Centre. Next year, several more floors at425 Market St. will come available. Leases with Charles Schwab andUnited Healthcare totaling approximately 204,000 sf are set to rollin March 2008. The floors they occupy are 11-16, 18 and 27.

The length of Sephora's lease commitment and the negotiatedlease rate were not released by the parties involved and nototherwise immediately available. The average direct lease rate inthe Downtown core is approximately $35 per sf per year, accordingto Starboard/TCN Worldwide.