Gap Unloads Athleta HQ in San Francisco for $80M
Sobrato buys 171K SF office building near city's famed Embarcadero.
Just a few weeks after Gap Inc. let it be known that it wanted to sell the headquarters building of its Athleta brand in San Francisco, Sobrato Organization has agreed to purchase the 171K SF property for close to $80M.
The Mountain View-based developer is paying slightly less than twice as much the $45M Gap paid for the office campus, which is in proximity to San Francisco’s famous Embarcadero. The deal translates into roughly $467 per SF.
In January, Gap filed an exploratory letter with the city regarding other potential uses for the office building located at 1 Harrison Street, according to the San Francisco Business Times.
Athleta, with about $350M in sales, is the specialty clothing retailers second-fastest growing brand, behind sales leader Banana Republic. Gap opened 30 new Athena stores in 2022 while closing twice as many Gap and Banana Republic stores combined.
The Athleta HQ is the second brand headquarters building Gap has divested. Last year, the company sold what used to be Old Navy’s headquarters at 550 Terry A. Francois Boulevard to DivcoWest for $365M—a price equaling $1,130 per SF for the 315K SF facility.
Gap continues to own its headquarters at 2 Folsom Street in San Francisco, a 545K SF building the company recently renovated.
Earlier this month, Gap followed up a low-key announcement last year of its new logistics business—called GPS Platform Services—with news of a game-changing partnership with a company that, along with Amazon and FedEx, has experience running one of the busiest logistics networks in North America: UPS.
Gap is teaming with UPS’ Ware2Go digital platform to offer small shippers access to Gap’s network of 35 fulfillment center for outsourced distribution services, including use of Ware2Go’s inventory tracking platform.
Gap says it is aiming to offer one-day “click-to-door” fulfillment to customers of businesses utilizing GPS Platform Services. These companies will have access to supply chain capabilities “previously only available to billion-dollar brands,” Gap said in a press release.
The partnership said it also is aiming at international companies that want to expand their US market share without investing in fulfillment infrastructure. Gap said it is investing $700M in improved automation, speed and efficiency at its fulfillment centers.