One of the leading companies in the AI race is doubling down on downtown San Francisco.
Real estate sources say Anthropic — which was founded in 2021 by a group of former OpenAI researchers — has agreed to lease two floors at 505 Howard St. in SoMa, adding to its presence at a complex known as Foundry Square.
The company is headquartered across the street, at 500 Howard St., where it subleased an entire 230,325-square-foot building from Slack in 2023. According to sources familiar with the new deal, Anthropic negotiated a short-term lease at 505 Howard St. so that both contracts will expire at the same time, in 2028.
By then, the company will have more options to deepen its presence in an area adjacent to Salesforce Tower and Salesforce Transit Center, since an empty office building at 300 Howard St. is expected to be renovated after its sale this year to DivcoWest and Blackstone Real Estate. The owners of that property are attempting to market the corridor as “AI Alley.”
Anthropic and its new landlord, American Realty Advisors, did not respond to requests for comment. The Chronicle was first to report the new lease.
Building owners are normally loath to agree to short-term leases, but the ability to get a brand-name tenant like Anthropic might mean future deals, since the company’s workers are already familiar with the neighborhood.
Silicon Valley Bank and IBM departed 505 Howard St. during the pandemic, while Intuit and KPMG moved in this year, according to CoStar. After Anthropic takes its two floors, the 300,000-square-foot building will have roughly a third of its office space available for lease.
Los Angeles-based ARA acquired 505 Howard St. for $350 million, or $1,200 per square foot, in 2016. The four buildings that comprise Foundry Square are owned by separate owners.
Sources say Anthropic, which this month raised $13 billion in Series F funding, is on the hunt for more office space. One of its main competitors, OpenAI, has amassed nearly 1 million square feet in offices in Mission Bay, and Anthropic is likely to expand near its headquarters and create a campus-like environment.
A total of 83 AI companies have leased nearly a million square feet of office space in San Francisco, according to real estate firm JLL. That coincides with 78.2% of all venture capital funding in the United States getting funneled to companies in the Bay Area, per Pitchbook.
The majority of the capital went to the likes of OpenAI, Anthropic, xAI, and Mira Murati’s Thinking Machines Lab; the latter leased a full building in the Mission last month.