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Riverbed Technology will relocate
to floors two through six
at 680 Folsom St. with
a 10-year lease term.

(Mark Your Calendars: RealShare REAL ESTATE 2012, March 22^nd in Los Angeles).

SAN FRANCISCO-TMG Partners and financial partner Rockwood Capital LLC have signed a 167,788-square-foot lease to relocate Riverbed Technology to 680 Folsom St., a class A office building in San Francisco’s South of Market District near the Moscone Convention Center. Riverbed, currently at 199 Fremont St., will move into floors two through six at 680 Folsom St. with a 10-year lease term.

David Churton, headquarter practice leader and international director at Jones Lang LaSalle, represented the tenant. He points out that the Riverbed real estate team “took a very strategic approach to their future real estate requirements.” He explains that by being proactive, “they executed a headquarters strategy ahead of today’s constricted market and netted a superb block of quality space offering the flexibility to accommodate growth as well as excellent terms and prominent signage in what will be the finest redevelopment in San Francisco in the last decade.”

According to Mayor Ed Lee of San Francisco, “Riverbed’s long term commitment to keep their worldwide headquarters in San Francisco through 2024 demonstrates once again that we are the location of choice for high tech companies. With dynamic leaders like Riverbed’s Jerry Kennelly, we are making San Francisco the ‘Innovation Capitol of the World.’”

According to a recently tech report from JLL, San Francisco is the top high-tech industry growth market with the most impacted office market. Booming high-tech industry employment growth of more than 15 percent is creating strong demand for office space and has boosted rents 18.5 percent over the past 12 months. Stiff competition between tenants for the best quality space is moving market rents toward pre-recession highs in some buildings and causing high-tech firms that prefer South of Market Street to head north into the CBD. The excitement has drifted into the capital markets space and investors are snapping up properties at rates last seen in 2007. The resurgence in high-tech is electrifying not only San Francisco, but the entire Bay Area.

According to Michael Covarrubias, chairman and CEO of TMG Partners, “Riverbed is the ideal tenant not only for this space, but to complement the increasing tech growth in San Francisco’s SoMa area.” GlobeSt.com could not get further lease terms, like aggregate lease value, asking rent or taking rent by deadline. An unidentified source not involved in the deal says base rent is approximately $50 to $54 per square foot per annum.

According to Riverbed co-founder and CEO Kennelly, “we think the City is the right location to attract the best talent and provide a thriving environment for our current employees. Moving to a state of the art building in the heart of the City will be a great move for our company.”

With construction now underway, the 12-story mid-rise tower at 680 Folsom St. and adjacent three -story building at 50 Hawthorne St. will be fully renovated to Class A standards. The $87-million renovation, supported by TMG and set for completion in late 2013, calls for 680 Folsom St.’s existing 1960′s concrete exterior to be replaced with a clear glass curtain wall skin.

In addition, a two-story vertical addition and several small horizontal additions will also be added to the building, “increasing the gross building area by more than 100,000 square feet for a total of approximately 522,000 square feet,” according to a prepared statement.

All building systems will be replaced and a new public plaza will be built on the corner of Folsom and Third streets, where there eventually will be a new 15,000-square-foot retail or cultural building constructed, says the release. A new glass, steel and granite lobby will have 30-foot ceilings with floor-to-ceiling glass and a floating staircase. The property is pursuing LEED Gold certification.

Pacific Bell owned and occupied the headquarters facility until 2007. In October 2010, TMG recapitalized the development with a new equity partner in Rockwood Capital.

Categories:

West,
Office,
Leasing,
San Francisco

Natalie Dolce Natalie Dolce, editor of the West Coast region for GlobeSt.com and Real Estate Forum, is responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, Natalie was Northeast bureau chief, covering New York City for GlobeSt.com. Dolce?s background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats Arthur Frommer?s Budget Travel magazine, FashionLedge.com, Co-Ed magazine, and has also freelanced for a number of publications including MSNBC.com and Museums New York magazine. Contact Natalie Dolce.

Article source: http://www.globest.com/news/12_280/sanfrancisco/office/87M-Renovated-Building-Gets-First-167788-SF-Tenant-318417.html