Former South City government building attracting new tenants

A huge former federal government warehouse — now privately owned and providing a much-needed tax boost to local agencies — has bagged an online fashion retailer as its first tenant and says there are more to come.

The owners of the SFO Business Center announced that in November Tobi.com, formerly located in downtown San Francisco, finished moving its corporate headquarters into their 571,000-square-foot building near the intersection of U.S. Highway 101 and Interstate 380.

The 1950s-era warehouse that has hosted the U.S. Postal Service and Drug Enforcement Administration was bought by Chicago-based Centrum Properties and New York-based Angelo, Gordon & Co. for $56 million and renamed the SFO Business Center in 2008.

For South San Francisco, it meant a massive building that was tax exempt is now generating roughly $500,000 a year in property tax revenue, with roughly 42 percent going to local schools, 25 percent to the county and 16 percent to the city. And with the owners planning $23 million in improvements as new tenants move in, its value is expected to grow.

“We are trying to attract the ‘new economy’ companies, whether it’s an Internet-based fashion company or a solar panel manufacturer,” Centrum Vice President Michael McClean said. “There’s certain types of businesses that work very well together even if they seem like they do very different things.”

The building owners say they are in serious talks with at least two other prospective tenants — a logistics company and a local perishable goods distributor — that they hope to bring in early next year. Eventually, they hope to create 750 new jobs for the city.

The three-year lease for Tobi.com gives the 50-employee company 60,000 square feet, which “offers new opportunities as we continue to grow and develop our business,” Chief Operating Officer Karen Liem said in a statement.

The center has enhanced the city’s already-strong commercial property tax base, anchored by Genentech’s $1.8 billion worth of property, which has helped insulate South San Francisco from the budget troubles facing other Peninsula cities.

The developers still lease about 77,000 square feet at the center to the Drug Enforcement Administration, though the USPS moved out in November.

Warehouse winnings

The SFO Business Center in South San Francisco is expected to be worth $109 million and generate $1.1 million in property taxes, according to a 2009 study. Here is a breakdown of yearly tax revenue for local agencies:

 

  • South San Francisco Unified School District: $469,444
  • San Mateo County general fund: $275,576
  • South San Francisco: $178,310
  • San Mateo Community College District: $78,853
  • County education tax: $41,036
  • Colma flood control, Zone 2: $33,888
  • Source: Brion & Associates

    sbishop@sfexaminer.com

Bay Area NewsLocalSan FranciscoSouth San Francisco

If you find our journalism valuable and relevant, please consider joining our Examiner membership program.
Find out more at www.sfexaminer.com/join/

Just Posted

Recology executives have acknowledged overcharging city ratepayers. (Mira Laing/2017 Special to S.F. Examiner)
Recology to repay customers $95M in overcharged garbage fees, city attorney says

San Francisco’s waste management company, Recology, has agreed to repay its customers… Continue reading

A construction worker watches a load for a crane operator at the site of the future Chinatown Muni station for the Central Subway on Tuesday, March 3, 2021. (Sebastian Miño-Bucheli / Special to the S.F. Examiner)
Major construction on Central Subway to end by March 31

SFMTA board approves renegotiated contract with new deadline, more contractor payments

(Kevin N. Hume/S.F. Examiner)
Settlement clears path for all youth, high school sports to resume in California

John Maffei The San Diego Union-Tribune All youth and high school sports… Continue reading

State to reserve 40 percent of COVID-19 vaccines for hard-hit areas

By Eli Walsh Bay City News Foundation State officials said Thursday that… Continue reading

Neighbors and environmental advocates have found the Ferris wheel in Golden Gate Park noisy and inappropriate for its natural setting. <ins>(</ins>
Golden Gate Park wheel wins extension, but for how long?

Supervisors move to limit contract under City Charter provision requiring two-thirds approval

Most Read