Sierra Club Move to Lake Merritt Punctuates San Francisco-to-Oaktown Relocation Trend

Image courtesy of Gensler

Uptown Station Oakland

By Robert Carlsen

Sierra Club, the venerable, 123-year-old environmental organization founded by John Muir, recently joined a growing list of San Francisco-based firms and institutions packing up and moving to Oakland.

[contextly_sidebar id=”dUZyDA582ZSfKDbonxZsHyX5Jsv3li4t”]Currently housed in 50,000 square feet in the former Pacific Bell building (built in 1899) at 85 Second St. between Market and Mission, Sierra Club will make the move to 2101 Webster St. in Oakland in May when its lease expires. The new space in the Lake Merritt/Uptown neighborhood occupies 38,776 square feet in what is known as the Center Twenty One Building. The organization currently has 200 employees.

Sierra Club’s communications director, Maggie Kao, said they are not downsizing the organization, but are instead looking for a “more efficient workplace footprint with cost savings on rent.”

“Sierra Club is pleased to announce that we are moving our headquarters from San Francisco to Oakland next spring,” said Bruce Hamilton, deputy executive director, in a statement made Oct. 1 when the move was officially announced. “Located in the heart of the Lake Merritt and Uptown Oakland neighborhood, 2101 Webster Street is LEED-certified and will support our values of workplace sustainability. We are grateful to the city of San Francisco for 123 years as our home and look forward to our new residence in dynamic Oakland.”

Meanwhile, commercial real estate brokers, told the Downtown Oakland and Lake Merritt/Uptown community benefit districts that companies executed leases for more than 156,000 square feet of space in the second quarter of this year, with a “significant” number of the new leases involving companies relocating from San Francisco.

Other San Francisco-based firms announcing that they are moving to Oakland, according to Jones Lang LaSalle, include Uber, which last month purchased the seven-story, 370,000-square-foot Uptown Station building currently under renovation at 1945 Broadway, which it will move to in 2017; Brown & Toland Physicians, which signed a multi-year lease for 60,000 square feet at the Clorox Building at 1221 Broadway in August; also in August, CoreLogic, a global property information, analytics and data-enabled services provider, signed a 23,842-square-foot lease at 555 12th St.; the California Institute for Regenerative Medicine (CIRM), which will move from Mission Bay later this fall to about 17,000 square feet in DivcoWest’s 1999 Harrison St. Building (aka Lake Merritt Plaza) in Uptown; Otis McAllister, a global food company, signed a 16,850-square-foot lease at 300 Frank Ogawa; Fluid, a digital shopping software firm, signed a lease for 16,000 square feet at 1611 Telegraph Ave.; and Huge Inc., a branding company, signed a 6,500-square-foot lease at 426 17th St.

According to JLL, “limited availabilities and rapidly increasing rental rates are pricing professional firms out of San Francisco, prompting them to move their back-office operations across the bridge.” JLL said its current tenant migration list has exceeded 1 million square feet since 2010, a majority of these tenants coming from San Francisco.

JLL noted that in the second quarter of this year, there was 56 million square feet of total inventory in the East Bay, a 13 percent vacancy rate, a $2.53 direct average asking rent and a 10.9 percent 12-month rent growth rate.

With entities like CIRM, the relative cost of space has been cited as a key factor in their decisions to move to Oakland, but with companies like Uber, the decision seems to be more about proximity to workforce and the authentic vibe that Oakland has versus San Francisco.

“Downtown Oakland has become quite popular for retailers, restaurateurs and other businesses,” said Steve Snider, district manager of the Downtown Oakland and Lake Merritt/Uptown District associations. “The diversity of business and their creativity with business concepts and services is clearly gaining momentum.”

And Robert Ogilivie, director of Oakland SPUR, said he wasn’t surprised about the current exodus of San Francisco firms heading to Oakland because “Oakland is a great place, has a great urban feel and is essentially the center of Bay Area transportation and transit, which makes it easy for people to live here.”

Rendering courtesy of Gensler

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