For Salesforce, Another Transbay Office Building Rises

By Sharon Simonson Inc., already the largest technology company employer in San Francisco with 4,000 workers, plans to double its real estate footprint in the city by 2016 to 1.8 million square feet.

350 Mission Street SOM Kilroy Realty Salesforce The Registry San FranciscoThe company’s downtown urban headquarters campus is integral to its culture, and its new building at 350 Mission St. with 450,000 square feet, is a “key addition,” said Chief Operating Officer George Hu. Salesforce employs 10,000 people worldwide.

“We are really starting to see the energy of innovation move from Silicon Valley to San Francisco,” Hu said. “San Francisco is full of startups. Our employees are thrilled to be here. I live in this city and am raising a family here. We are so committed to this city.”

Hu, San Francisco Mayor Ed Lee and John Kilroy Jr., president and chief executive officer of Kilroy Realty Corp., gathered April 16 along with other dignitaries to acknowledge the construction start of the approximately $275 million building. It is the latest in a string of huge construction starts and announcements around the city’s more than one million-square-foot Transbay Transit Center, now under development itself.

Office landlords Boston Properties and Hines celebrated the start of their Transbay Transit Tower next to the transit center earlier this month. The transit center is envisioned as a massive bus and commuter-train transportation hub for San Francisco and the entire Bay Area with ultimate connections to Southern California via high-speed rail. The Transbay Transit Tower, the tallest on the West Coast, is across Mission Street from 350 Mission, which was designed by Skidmore Owings & Merrill LLP architects.

The 30-story 350 Mission office building, which Kilroy is developing, is billed to feature dazzling additions, including lobby furniture that will move one inch every hour. “I’m not sure how that works, but it sounds exciting,” Kilroy said.

It also has a “50-foot-high urban living room at the building’s base … which blurs the boundaries between the public and private realms,” according to SOM.

That “urban living room” will feature a 40-foot by 75-foot “digital canvas” where people arriving by train or bus at the new transit center can plug into news not only about Salesforce but also about the city. “They will be able to connect immediately with what is going on in this community,” Kilroy said.

350 Mission also is expected to be the first ground-up commercial development in San Francisco certified as meeting Platinum-level specifications for the Leadership in Energy and Environmental Design, or LEED, program.

Kilroy has invested more than $2 billion in San Francisco office real estate in the last two years, acquiring 303 2nd St. and 100 1st St. in 2010 and four additional properties in 2011.

100 1st St. also sits on the cusp of the new Transbay Transit Center and is a five-minute walk from 350 Mission.

“This is a celebration of San Francisco, which is once again setting the example for exceptional and liveable environments,” said Eli Khouri, chief investment officer for Kilroy. “San Francisco has the densest urban environment on the West Coast and was far ahead in making great transit a central pilar of its vision. This and the Central Subway will propel the economic progress of the city.”

Kilroy buildings such as 303 2nd St. and 201 3rd St. are within easy walking distance of the Central Subway line, which will travel below the city’s 4th Street corridor across Market Street into the center of the city.

The deal to lease 350 Mission to Salesforce came together in a whirl late last year, Kilroy said, after the company bought the land in October for $52 million. The lease with Salesforce was signed within “six or seven weeks” after that. “It was the fastest deal ever,” Kilroy said.

The deal was contingent on Kilroy securing city approval to add three stories to the formerly 27-story highrise, increasing the building’s square footage by about 50,000 feet. Both Kilroy and Salesforce’s Hu praised the mayor and city staff for accommodating the change and helping business in the city to succeed.

Kilroy, which is also building the new Synopsys Inc. campus in Sunnyvale and the LinkedIn Corp. headquarters campus in Sunnyvale, has its quarterly conference call to discuss first-quarter performance at 10 a.m. Pacific time May 1.

Rendering courtesy of Skidmore Owings & Merrill

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