Twitter Plans to Close Office in San Francisco, Reduce NYC Space
By Nicholas Rizzi July 27, 2022 11:37 am
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Twitter plans to close one of its San Francisco offices and reduce its New York City footprint in an effort to cut costs amid fears of a global recession, the latest large tech firm to pull back on physical offices.
The social media platform told employees Wednesday that it will shutter its 1 10th Street office in San Francisco and consolidate it into its Market Street headquarters, located behind its 10th Street space, Bloomberg first reported. Twitter also ditched plans to open an Oakland, Calif., office and is considering closing its outposts in Sydney; Seoul; Madrid; Wellington, New Zealand; Osaka, Japan; Hamburg, Germany; and Utretch, Netherlands.
Twitter — which told employees they could work from home permanently in 2020 — also plans to reduce space in Tokyo, Mumbai, New Delhi and Dublin. In New York, Twitter will try to sublease a full floor of its nearly 140,000-square-foot space at 245 West 17th Street, the company told Commercial Observer.
“We are evaluating our global office portfolio and resizing certain locations based on utilization,” a spokesperson for Twitter said in a statement. “We’ve proven we can operate our business successfully with a distributed workforce over the years, and remain committed to our employees, our customers and the markets we serve.”
The spokesperson added that the decision to reduce its offices will “not impact our current headcount or employee roles,” as dozens of tech firms implement hiring freezes and lay off staff.
Tech firms provided a beacon of hope to Manhattan’s office market during the pandemic, with Facebook inking a massive 730,000-square-foot deal at the Farley Post Office and Amazon announcing plans to open a 2,000-person office at the former Lord & Taylor flagship on Fifth Avenue. Such moves helped tech overtake finance as the biggest driver of office leasing in the borough.
However, tech firms have cut back on space in recent weeks. Yelp closed its offices in New York City, Washington, D.C., and Chicago and shrunk its outpost in Phoenix. Meta, the parent company of Facebook, dropped plans to add 300,000 square feet to its footprint at 770 Broadway and paused plans to build out its Hudson Yards offices. Amazon pulled out of its sublease with JPMorgan Chase at 5 Manhattan West and halted work on the construction of 4 million square feet of new space in Washington state and Nashville. Netflix announced plans to sublease about 180,000 square feet in Los Angeles, while Salesforce put more than 412,000 square feet up for sublease in San Francisco.
Overall, the share of Manhattan office space leased to tech firms has declined in the past three quarters from a high of 31 percent in the fourth quarter of 2021 to 18.7 percent in the second quarter of 2022, according to data from Savills.
Nicholas Rizzi can be reached at nrizzi@commercialobserver.com.
