Two large Bay Area stories are converging as social media platform Twitter considers new ownership and at the same time looks to sublease some of its excess office space at the Market Square headquarters in San Francisco. Last week, according to two sources a group has been selected to proceed with sublease negotiations, which will take a few weeks to finalize. That group is NerdWallet, and they are looking to sublease approximately 120,000 square feet of the roughly 180,000 square feet Twitter had put up for subleasing earlier this year.
The Market Square office consists of two buildings, the 1355 Market Street building and the 1 Tenth Street building just behind it. Roughly 79,000 square feet of space is available in the 1355 Market Street building on the seventh floor, while the 1 Tenth location has three floors of approximately 35,000 square feet available on each floor.
The space is marketed by the San Francisco office of Cresa. Christina Clark, Craig Zodikoff, Jamie Saunders and Erik Carlson work on the team marketing the location. They were not available for comment or confirmation of the lessee selection process.
Market Square and 1 Tenth span an entire block of Market Street in the city’s Mid-Market area. The renovations by Shorenstein transformed two former retail warehouses into 1,264,182 square feet of Class A creative office space. 1355 Market, an Art Deco icon built in 1937, has been rebranded as Market Square, but is more popularly known as the Twitter Building.
In August of 2015, Shorenstein recapitalized the buildings for around $900 per square foot or $900 million with J.P. Morgan, retaining a 2 percent interest in the building. J.P. Morgan funded the transaction with two capital sources. 49 percent of the deal was taken by the real estate manager’s commingled fund, the J.P. Morgan Strategic Property Fund. The other 49 percent was taken by an Asian group that the real estate manager represents.
The two buildings were purchased by Shorenstein in March of 2011 for $120 million, according to public documents.
NerdWallet has been shopping for space for some time, according to a number of reports. In 2014, the financial services review company signed a nearly 45,000 square foot lease at 901 Market Street. According to its representatives, the firm now employs nearly 400 workers. Crunchbase reports that the company has raised $102 million in two equity and one debt round. $33 million in debt financing was provided by Silicon Valley Bank in May of 2015. In June of 2016, NerdWallet acquired aboutLife, a San Francisco-based company that provides advice on retirement questions.