Another technology company is looking to reduce its office footprint across the country. San Francisco-based Lyft is planning to reduce its office leases in four cities by about 45 percent of the total 615,000 square feet it leases. The reduction in office space will be made in its hometown San Francisco and also in New York, Seattle and Nashville, the company confirmed to multiple media outlets.
This decision comes after an announcement in March of 2022 when Lyft stated that it was moving to a permanently flexible office policy allowing its employees to work from anywhere.
“While we continue to believe that in-person connections are important, many of our team members opted to work remotely after we shifted to a flexible workplace strategy,” a spokeswoman said in an emailed statement to Bloomberg, who originally broke the story. “[We] identified a significant amount of office space that isn’t being utilized the way it previously was.”
In San Francisco alone, the company will be reducing its footprint at 185 Berry Street, where it will reduce its footprint by 85,000 square feet in that property once the lease expires in 2023. It will also place another 165,000 square feet in the same building on the sublease market, since that lease expires at a later date. That comes to a total of 250,000 square feet in San Francisco alone.
The remaining 25,000 square feet will come from leases in the other three cities.
According to a report by MarketWatch, Lyft has been working on cutting costs this year as its stock price has seen a drop of 64 percent this year. This has resulted in a reduction of budgets and slower hiring. The company has also been under pressure to turn a profit.
The news follows other companies’ decisions to reduce its unused office space. The Registry had reported this month that Netlifx was placing 164,000 square feet across two buildings on the sublease market in Los Gatos. In February, Slack put 208,460 square feet of space on the sublease market in San Francisco. Zynga placed 185,000 square feet in San Francisco on the sublease market about a year go and Airbnb added 300,000 square feet to the sublease tally in July of 2021. In July of 2022, Twitter announced that it would not occupy the 66,000 square foot lease in Oakland it signed with TMG Partners and KKR at 1330 Broadway while trimming its offices in San Francisco and also around the globe in Europe and Asia. Even the fabled venture capital firm Andreessen Horowitz announced that it was moving its headquarters to the cloud.
“It turns out that running a technology company remotely works pretty darned well,” Horowitz stated in his blog post speaking about his firm’s decision and the general trends of distributed work.
“When I see headlines about CEOs trying to lure employees back to the office, I feel like it’s probably a doomed approach,” explained Slack CEO and Co-Founder Stewart Butterfield to The Washington Post in December of 2021. “Work is no longer a place you go. It’s something you do.”