Wells Fargo renews major East Bay office lease while downsizing in headquarters city of San Francisco
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While Wells Fargo & Co. has significantly scaled back its presence in San Francisco, raising questions about the city's future as its headquarters, the bank is recommitting to office space in the East Bay.
Wells Fargo inked a lease renewal for 257,000 square feet of space across the two-building Concord Tech Center, according to a source familiar with the deal. The lease renewal marks likely the largest office lease deal in the East Bay signed so far this year, as many large companies have shrunk and vacated their back office space in suburban Bay Area markets in recent years.
This news arrives after Wells Fargo reduced its San Francisco office footprint to less than half of its prepandemic scale, and listed its 409,000-square-foot headquarters for sale last December, fueling speculation that the bank might relocate its headquarters out of California to Texas. The bank recently opened its sparkling new $455 million campus in the Dallas suburbs that some have viewed as a future headquarters for the company.
Wells Fargo declined to comment for this article. A Wells Fargo spokesperson told the Business Times last December the bank’s corporate headquarters remains in San Francisco, and that they had “no plans to move it out of the city.”
The Concord Tech Center space is Wells Fargo’s flagship East Bay campus. The company’s total footprint in Concord will be 307,000 square feet, as it occupies an additional 50,000 square feet in a lease set to expire in 2028. The deal that closed Friday was a slight reduction in space, downsizing from 335,000 square feet. The bank will now occupy all of 1755 Grant St. and three floors of 1655 Grant St. in a five-year lease renewal.
Concord’s office market took a big hit in 2023 when Bank of America exited its roughly 300,000-square-foot lease at 2000 Clayton Rd. That building was part of a four-building campus that the bank built in the 1980s, which it later sold to Swift Real Estate Partners in 2011.
Bank of America’s downsizing left Wells Fargo as the city’s largest tenant. Concord’s office market is feeling the challenges of the postpandemic shift and slower leasing activity, with office vacancy in Concord reaching 31.4% in the second quarter, higher than the regional average of 21.3%, data from real estate services firm CBRE shows.
“They are the biggest occupant of office space in all of Concord… for the health of that submarket and I’m sure the Concord job market in general, it’s a really big deal,” JLL's Trent Barmby said. “To have Wells make a recommitment … sends a loud message that they’re committed to the Bay Area and the East Bay.”
Barmby and Kevin Mechelke represented Wells Fargo in the lease deal, Newmark represented the landlord.
This news follows several large office tenants in the suburban East Bay market slashing space or leaving the market altogether. Chevron in July listed its entire 400,000-square-foot office space in Bishop Ranch for sublease, after it announced August 2024 plans to move its headquarters to Houston.
In April, BMO Bank downsized from a 276,000-square-foot lease at Bishop Ranch to 30,000 square feet. Last December, Robert Half shrunk its footprint at Bishop Ranch from 250,000 square feet down to a 73,000-square-foot space.
San Francisco-based Redco is currently under contract to acquire Wells Fargo’s former headquarters at 420 Montgomery St., after a deal to sell the building to a residential developer fell through.