S.F. tech company expands its footprint as leasing surge lifts downtown office market
data bricks Technology company 1 Sansome St. doubled its sales in San Francisco by expanding its office space at 90,000 square feet; The resurgent office market, now increasingly supported by AI tenants, is showing its strongest momentum in years.
The expansion comes nearly a year after Databricks committed to a long-term, 150,000-square-foot lease in the Financial District tower and comes as demand for downtown offices surged in the first quarter, availability tightened in high-end buildings and triple-digit rents rose to record highs. That’s according to preliminary market data from the first months of the year, first provided by real estate brokerage CBRE.
For years, downtown office vacancy has hovered in the mid-30% range; this is a historic high resulting from the shift to remote work during the pandemic; A wave of sublease space has hit the market as many companies downsize, muting leasing activity in the city’s once-dominant tech sector.
Now, there are the first signs of a transformation: CBRE reports that vacancy fell to 30.8% in the first quarter; This is a significant improvement from 33.5% in the last quarter of 2025. This figure is driven by renewed demand, which the firm defines as tenants collectively seeking 8.2 million square feet of office space in the market.
That still means a ton of empty offices with no buyers. But things are looking up: So far in the first quarter, net absorption, a key measure of whether companies are taking in more space than they’re giving back, has turned positive, rising above 1.8 million square feet, according to CBRE. This marks a meaningful shift for a market that has spent much of the last few years in negative absorption as tenants downsize or exit offices altogether, as previously reported by the Chronicle.
The company reported that the total office space rented in recent months was approximately 3 million square meters, and more than half of it was requested by artificial intelligence tenants.
“The San Francisco office market recorded the highest quarterly net absorption figure in its history,” said Colin Yasukochi, managing director of CBRE Tech Insights Center. “This reduced the vacancy rate by two percentage points to 30.8% compared to Q4 2025. Since demand turned positive in Q4 2024, more than 4.4 million square feet of space has been newly occupied, mostly by AI tenants.”
Databricks’ expansion at 1 Sansome is among the top five largest leases of the quarter, bringing its total footprint in downtown San Francisco to approximately 240,000 square feet. The company is also scaling in Silicon Valley, signing a separate 330,000-square-foot expansion in Sunnyvale, according to a spokesperson.
