Much of San Francisco’s white collar tech workforce can go ahead and get used to working in their PJs.
Salesforce, San Francisco’s largest private sector employer, became the latest local company to join the work-from-home-forever club this week. The company announced that the majority of its workers would partake in a “flex” work model, coming into the office 1-3 days per week. Smaller portions of the company’s workforce would continue coming into the office five days a week, or continue to work from home full time, respectively. In their blog post on the changes, the company says it will redesign its offices to emphasize collaborative work that can only be done in person.
San Francisco-based tech companies appear to be on the vanguard of this trend. After becoming some of the first companies to close their offices in the early days of the pandemic, many have found that remote work suits their needs just fine. Brex, Coinbase, Dropbox, Square, and Reddit are a few of the high profile firms to allow virtually their entire workforce to go remote, even after mass-vaccination.
But the announcement from Salesforce, whose eponymous tower and urban corporate campus at Mission and Fremont became a symbol of San Francisco’s tech boom, feels like a particularly weighty blow to the city’s economic sense of self. It remains unclear how the company’s policies will affect its massive real estate footprint in the city. However, if Salesforce follows in the footsteps of other tech companies, it could mean it will shed office space.
Earlier this month, the Chronicle reported that Yelp will be totally vacating its 140,000 square foot HQ at historic 140 New Montgomery, although the company pledges to maintain an office presence in San Francisco. Twitter, Dropbox, and Levi Strauss have put large portions of their headquarters on the market. Just this week, the San Francisco Business Times revealed that Uber is hoping to sublease almost a third of its brand new headquarters next to Chase Center.
All of that office space on the market translates to a whole lot of empty cubicles. As of January, there was 13.9 million square feet of vacant office space in the city, up from 5 million square feet pre-pandemic, according to real estate news publication Socketsite. The current office vacancy rate is the equivalent of more than 10 empty Salesforce Towers.
These trends are very concerning for local mass transit agencies and San Francisco’s tax rolls. Fewer people commuting downtown means fewer riders on BART, Muni, and Caltrain, and fewer patrons at downtown restaurants and stores — to say nothing of the many business and property taxes big companies contribute to the city.
Meanwhile, the tech companies themselves are doing great, for the most part. Salesforce recently bought the workplace messaging app Slack, and has seen its stock price nearly double since the beginning of the pandemic. Many other big tech companies have performed similarly well.
And for all the downsides of all that empty office space, it also means more room — and cheaper rents — for other kinds of businesses. Just like renters in San Francisco’s plummeting apartment market, companies might want to lock in a favorable lease while they can.
A previous version of this article incorrectly stated the number of employees who work at Salesforce.