Facebook has inked a lease for all 432,000 square feet of office space across the lower 50 floors of the 70-story tower finishing up construction at 181 Fremont Street.
The space can accommodate up to 3,000 workers, many, if not most, of which are likely to be current employees and residents of San Francisco who have been commuting down to Facebook in Menlo Park, such as “a small team from Instagram” which will be the first to make the move and christen the tower in early 2018, according to the San Francisco Business Times.
The 802-foot 181 Fremont in the Transbay district is set to open by the end of the year.
The deal is the first for Facebook (NASDAQ: FB) in San Francisco. The world's largest social network had been looking to expand to the city for years as workers who live there longed for an easier commute. The company now shuttles thousands of employees to its headquarters in Menlo Park, where it is also growing. The space at 181 Fremont can hold between 2,000 and 3,000 employees.
“This region seems poised for continued growth. (San Francisco) is really a gateway city. That wasn’t the case seven, eight years ago," Lituchy told the Business Times in January.
Facebook said its Instagram photo app division would be the first occupants of the tower.
"While Instagram's HQ will remain in Menlo Park on Facebook's campus, a small team from Instagram will be moving to San Francisco in early 2018. With this lease, we've obtained the space we need at 181 Fremont to support our growth," said Jamil Walker, a Facebook spokesman.
Sources said Facebook had also considered taking space at the San Francisco Chronicle building.
The year has been dominated by leases from established, public tech companies, rather than startups. Alphabet Inc.'s Google Inc. (NASDAQ:GOOG), Amazon.com Inc. (NASDAQ: AMZN) and Salesforce.com Inc. (NYSE: CRM) have all signed large deals this year.
Broker Zé Figueirinhas of JLL represented Facebook in the deal. Karl Baldauf of Newmark Cornish & Carey represented Jay Paul.
The deal is a sign that despite over 3 million square feet of office space opening this year in San Francisco and softening job growth, demand for pricey new office space is still strong. Two large projects, Park Tower and the Exchange, are still looking for their first tenants.