K
PMG is set to join a growing list of companies downsizing their operations in San Francisco. The New York-based accounting firm has leased a 96,300-square-foot office at Foundry Square III, located at 505 Howard Street in the city's South Financial District. This move is expected to take place in September 2026, marking a significant reduction in the company's footprint by 32.6 percent compared to its current office at 55 Second Street. The terms of the long-term lease agreement for the 10-story, 307,000-square-foot glass building have not been disclosed.

    KPMG's decision comes after the company extended its lease at its current location until September 2026. The three floors at Foundry Square III, currently leased to IBM, are set to be vacated by the end of December 2025. Foundry Square III, owned by American Realty Advisors based in Los Angeles, is one of four buildings at the mixed-use Foundry Square campus near Salesforce Park. The occupancy rate of the building remains undisclosed.

    KPMG plans to adopt a hybrid work model for its 1,000 employees in San Francisco. The shift towards remote work due to the pandemic has resulted in a significant increase in office vacancies across the city, with a vacancy rate of 37 percent being one of the highest in the U.S. Artificial intelligence firms have bucked this trend, with OpenAI leasing one of the largest spaces since 2018. However, most companies have reduced their office footprints in Downtown San Francisco, according to recent reports.

    In a related development, Capital One Financial has announced plans to move its operations to a newly leased 40,000-square-foot office at 100 California Street, thereby cutting its local real estate footprint by two-thirds. This move is part of a broader trend of companies downsizing their operations in San Francisco due to the pandemic and other factors.