Not even a month after Microsoft announced they opened an “AI Co-Innovation Lab” at 555 California, the tech giant is now trying to lease off the space at the building that is, infamously, partially owned by Donald Trump.
The giant downtown office building 555 California was once the tallest building in SF (until the Transamerica Pyramid was completed). In recent years it’s gained notoriety for other reasons; this past winter because glass was blown off its windows during the storms, and of course, because the family of none other than Donald J. Trump co-owns the building with a 30% share.
Now the building located, naturally, at 555 California Street is in the news for other reasons. The SF Business Times reports that Microsoft is trying to unload a bunch of office space they have at 555 California, as SF’s well-documented office space vacancy woes continue.
It’s a surprise move, because not even a month ago, Microsoft made a big announcement that they had opened an “AI Co-Innovation Lab” at 555 California. It’s unclear whether that lab will be booted or discontinued, and frankly, whether Microsoft can find a new tenant willing to take the space anyway.
The Chronicle reviewed marketing materials for the sublease Microsoft is offering, and characterizes the available space “as small as 4,500 square feet” and “up to 49,000 square feet.” Presumably, Microsoft would prefer you rented more on the larger end of that space estimate. The lease runs through May 2029.
Surprisingly, the Chronicle notes that 555 California is 94.5% leased as of July. Obviously that’s an estimate from a few months ago, but that’s still a stratospheric lease rate in the current office space downturn. The building still has blue-chip tenants like Goldman Sachs, Morgan Stanley, McKinsey & Co., and Bank of America (who used to have their global headquarters at the building).
Back in February, the building had been placed on a lender watchlist, as Bloomberg reported, because of its $1.2 billion mortgage, and questions about whether its owners — the Trump organization and Vornado Realty Trust — would be able to service that debt.
Image: Kevin Y. via Yelp