Pinterest Cancels Alexandria/TMG 490,000 SQFT Central SoMa Lease, Takes One-Time $89.5MM Hit

Alexandria Real Estate Equities, TMG Partners, San Francisco, Bay Area, Pinterest, Bay Club, Pasadena, San Francisco Planning Commission, SoMa
Image Credit: Alexandria Real Estate Equities

(EDITOR’S NOTE: Alexandria Real Estate Equities and TMG Partners received full project approval from the San Francisco Planning Commission on their proposed 1.07 million RSF mixed-use development project at 88 Bluxome Street in Central SoMa in July of 2019, according to a statement from the two companies. The project was the first within the Central SoMa Plan to be fully approved and receive its full Prop M allocation. It was going to be anchored by Pinterest, Inc. and the Bay Club with construction expected to commence in 2020 and initial delivery in 2022.)

SAN FRANCISCO–Pinterest, Inc (PINS) announces that it has terminated its lease for approximately 490,000 square feet of office space to be constructed near its current headquarters campus in San Francisco, California. Instead, the company’s present plan is to continue to lease its current buildings in downtown San Francisco and remain an active member of the local community.

This action is intended to support a more diverse and geographically distributed workforce at Pinterest. “As we analyze how our workplace will change in a post-COVID world, we are specifically rethinking where future employees could be based,” said Todd Morgenfeld, CFO and Head of Business Operations of Pinterest. “A more distributed workforce will give us the opportunity to hire people from a wider range of backgrounds and experiences.”

The agreement involved a one-time payment of $89.5 million in the third quarter of 2020. This will be reflected in Pinterest’s financial statements as a GAAP general and administrative expense, to be filed with its Quarterly Report on Form 10-Q for the period ended September 30, 2020. As a result of the termination, Pinterest will no longer be subject to future minimum lease payments of approximately $440 million as disclosed in prior filings.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, about us and our industry that involve substantial risks and uncertainties, including, among other things, statements about our future operational and financial performance. Words such as “believe,” “project,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “plan” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are only predictions and may differ materially from actual results due to a variety of factors included in our most recent Form 10-K or 10-Q filed with the SEC. All information provided in this press release is based on information available to us as of the date of this press release. We undertake no duty to update this information unless required by law.

About Pinterest

Pinterest is a visual discovery engine more than 400 million people use each month to find inspiration for their lives, including recipes, home and style ideas, travel destinations and more. People have saved more than 240 billion Pins across a range of interests, which others with similar tastes can discover through search and recommendations. Located in San Francisco, Pinterest launched in 2010 and has hundreds of millions of monthly active users around the world. Available on iOS and Android, and at pinterest.com.

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