Uber, one of San Francisco’s largest employers, will allow workers to stay home until at least July 2021, joining Google in an extension of remote work that could prolong the city’s economic pain.
Uber’s offices will reopen sooner, but workers will have the option to stay remote until next summer or volunteer to return when local offices are allowed to reopen. They will each receive $500 stipends for home office equipment.
“As a company built on flexible working, we want to provide our team with flexibility, choice and longer term clarity so they can plan ahead,” Lois Van Der Laan, an Uber spokeswoman, said in a statement. The company will reevaluate the policy next spring but will not shorten it.
Around a third of the ride-hailing company’s more than 20,000 employees are in the Bay Area. Uber has five San Francisco offices, including its headquarters building at 1455 Market St., and a Palo Alto facility.
Square, another major tenant at 1455 Market St., and Twitter, which is a block away, both said in May most employees can work from home indefinitely. Google also extended its work from home allowance for most employees through next June. Many city workers are staying home as the coronavirus pandemic worsens, further pummeling retail and food businesses in the Mid-Market and Civic Center neighborhoods.
The lack of foot traffic has badly hurt businesses like the Market grocery store and food hall in the Twitter building, which has seen sales for some vendors plummet by 90%. Downtown businesses are also struggling.
New York Times reporter Mike Isaac first reported Uber’s plan to extend its work-from-home policies on Twitter.
The coronavirus crushed Uber’s core ride-hailing business, with an 80% drop in April business compared with the previous year, according to the company’s earnings report, though ridership partially rebounded afterward. Uber laid off 6,700 employees this year, including 1,218 in San Francisco and Palo Alto, according to California state filings. (Uber does not count drivers among its employees.)
Uber plans to leave Mid-Market for a new four-building headquarters complex adjacent to Chase Center in Mission Bay. It isn’t clear when that move will occur. Uber didn’t disclose information on moving plans on Tuesday.
Last year, Uber listed 729,352 square feet across its four San Francisco buildings for sublease as it prepared to relocate. This year, the company said another office at Pier 70 would close. Uber didn’t have any updates on sublease activity.
The city’s once-booming office market has been chilled by coronavirus-induced uncertainty. Executives at Hudson Pacific Properties, landlord of 1455 Market St., said on an earnings call last week that Uber’s sublease listing in that property will have to compete with more office availability, which could dampen rents.
“We’ve seen an increase in vacancy in San Francisco that’s almost doubled from where it was two quarters ago to where it is today,” Mark Lammas, president of Hudson Pacific Properties, said on the call. “That’s going to have some downward pressure on rate and negotiability for the sublease space.”
In another hurdle for Uber, Lammas said “it would take an exceptional amount of negotiation and quality” of subtenant for Hudson Pacific to agree to release Uber from its existing lease. There are four or five years remaining on Uber’s obligation, so a major tenant would likely have to negotiate with Hudson Pacific for a longer lease, he said.
“So I think this game is to be played out,” Lammas said.
Roland Li is a San Francisco Chronicle staff writer. Email: roland.li@sfchronicle.com Twitter: @rolandlisf
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August 05, 2020 at 06:02AM
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