SAN FRANCISCO—After large deals for tech giants Facebook, Salesforce, Dropbox and Adobe, Okta ended the year with a 10-year lease for its new 207,000-square-foot headquarters at 100 First St. in SoMa owned by Kilroy Realty Corporation. A provider of identity for the enterprise, Okta is expanding its footprint in the city in the wake of its April 2017 initial public offering and anticipated growth plans.
100 First Street is a 27-story 467,000-square-foot office building designed by Skidmore, Owings and Merrill and built in 1988. The LEED Gold and Energy Star-certified property is currently 95% leased. Okta's expected occupancy is to occur in phases, beginning in the second quarter of 2018. The lease will replace all of Delta Dental's 188,000 square feet that expires in the second quarter of 2018 as well as include an additional 19,000 square feet in the building.
Paul Hastings LLP represented Okta in the lease. The team was led by real estate partner Steve Berkman and included associates Anna Cressman and Samantha Sheehan. In addition, Berkman also advised on the Facebook and Salesforce transactions.
“It seems to me, we will see more of the same in 2018,” Berkman tells GlobeSt.com. “The demand is growing and we need more office space. This demand is driven from the top, from the Facebooks, Googles and Amazons. As recently as a year ago, everyone stayed in their lanes. Facebook stayed in Menlo Park and Google stayed in Mountain View but now, they are branching out for space.”
Indeed, the lease at 100 First St. is the most recent in a series of transactions executed by Kilroy Realty. During the past 12 months, the company signed three of San Francisco's largest office leases that in aggregate, total approximately 1.3 million square feet. In October, Kilroy Realty signed the single largest commercial lease in San Francisco history with Dropbox totaling 736,000 square feet at The Exchange at 16th. And in November 2016, the company's lease with Adobe at 100 Hooper totaled 320,000 square feet. Year to date, Kilroy Realty has signed more than 2.5 million square feet of leases throughout its stabilized and development portfolios.
“San Francisco continues to incubate some of the most dynamic new companies in the world and we are delighted that Okta, a thriving newly public company, has chosen to join our roster of tenants in the city,” said John Kilroy, chief executive officer. “I'm proud of our team for their relentless commitment to drive our deal-making machine and deliver extraordinary leasing results with high-caliber tenants, including our recent transactions with Okta, Dropbox and Adobe.”
The success of these leases reflects Kilroy Realty's ability to meet the specific needs of growing companies and workforces such as Okta. The new space will give the team at Okta room to scale, build and innovate for customers as it expands in the coming years, all under one roof in San Francisco.
“Growth companies in San Francisco are looking for unique spaces that energize and motivate their employees and are also highly efficient,” said Chris Roeder, international director, JLL.
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
