A full reversal from an Ed Lee-era “Twitter tax break” deal, as after Zendesk bailed from 2019 Market Street during the pandemic, the City of San Francisco is buying the property with plans to transform it into a “mental health service center.”

It’s amazing how some things have changed during the 12-year boom-and-bust cycle since the so-called Twitter tax break of 2011 (Technically known as the “Central Market/Tenderloin Payroll Tax Exclusion”). One benefactor of that tax break was Zendesk, who signed a generous eight-and-a-half year lease in 2013 to occupy the 77,000 square-foot building at 1019 Market Street which was part of the tax break zone.

But after the pandemic hit, Zendesk paid $7 million to abandon that lease and leave the building, amidst the still-continuing dismal office space market downturn.

But this means likely a new life for 1019 Market Street (at Sixth Street). The San Francisco Business Times reports the City of San Francisco plans to acquire 1019 Market Street. Or at least, that’s what an application posted Tuesday at the SF Planning Department indicates.

Screenshot: SFPlanning.org

A screenshot with the pertinent parts of the application can be seen above. “This project involves the acquisition of 1019 Market Street from the current owner, 1019 Market Street LP,” the application states. “The building will be used as a mental health service center that will include a pharmacy and transportation. It will serve the uninsured and the homeless upon acquisition by City and County of San Francisco.”

So much did the city pay for this building? We don’t know yet, and the “upon acquisition” language indicates the deal has not closed yet. Per the Business Times, the building last sold in 2014 for $48 million, but boy has the market softened since. That publication also reports that “the property was valued at $39.6 million in the 2022-2023 tax year."

The ground floor of the otherwise largely vacant building is still occupied by David Rio Chai Bar, though the application indicates it will not stay under the building’s proposed new use. Meanwhile, Zendesk has since moved its headquarters to about a block up the street, to 989 Market Street.

Related: Pinterest Offloading Yet Another Office Building In SoMa, This Time at Fourth And Brannan Streets [SFist]

Image: Google Street View