Considering that Salesforce.com signed an 18-year lease for over half the 817,000-square-foot building they currently occupy at 50 Fremont in 2012, a lease which includes the right to buy the building in 2017, it really shouldn’t come as too much of a surprise that the company is reportedly in contract to buy the 43-story building.
The real surprise is that TIAA-CREF, which favors stable, long-term investments, is selling the building earlier than necessary, unless their analysts aren’t expecting the 50 Fremont Street tower to be worth more in a year or two.
Salesforce, the largest technology employer and leaseholder in San Francisco, lost $400 million on nearly $5 billion of revenue over the past twelve months but has been growing their top line at over 30 percent per year.
UPDATE: The Business Times has confirmed a contract price of $640 million for the 50 Fremont Street tower, or roughly $780 per square foot. While inked this week, the sale is slated to close in the first quarter of Salesforce’s fiscal year 2016 which begins February 1, 2015.