An AI venture co-founded by Jeff Bezos is reportedly nearing a lease agreement for a building in San Francisco. Amidst a significant downturn in the city's office market, the Sobrato Organization made a bold investment of over $80 million to acquire the former headquarters of Gap, located at the waterfront. Their prediction that the building could cater to a new wave of tech tenants is now on the verge of realization, as Prometheus, Bezos’s AI startup, appears set to occupy the refurbished property at One Harrison. This deal could validate Sobrato's investment and underscore how the burgeoning AI sector is reshaping corporate preferences in office environments.
Real estate sources have informed the Chronicle that Prometheus is finalizing a lease for all six floors of the 180,000-square-foot building, conveniently situated near Google’s offices by the Embarcadero. Previously, the well-funded startup had been leasing a smaller, 30,000-square-foot space in the 101 Mission St. tower, but has silently been searching for a more expansive location in recent months.
While Prometheus representatives did not provide comments on the potential lease or its intended use, it’s evident that the new space would significantly enhance the startup's presence in San Francisco and fulfill Sobrato's aspiration to secure a primary tenant at One Harrison.
On Friday, Sobrato refrained from confirming any lease with Prometheus or disclosing the status of a potential deal.
Founded in 2025 by Bezos and former Google X executive Vik Bajaj, Prometheus specializes in developing AI technologies for engineering and manufacturing, aiming to integrate AI solutions into the tangible world. The startup launched late last year with $6.2 billion in funding and recently achieved a valuation of $41 billion after raising $12 billion. Its prestigious investors include JPMorgan Chase, Goldman Sachs, and BlackRock, alongside Bezos and others.
Prometheus is focused on creating software that automates the design and production of various complex items, ranging from airplanes and computer chips to pharmaceuticals. This summer, the company secured a 100,000-square-foot lease for a warehouse situated in an industrial area of West Oakland.
Historically, One Harrison was owned by Gap for over 20 years, most recently serving as the base for Athleta. The building features a contemporary design, characterized by its glass and concrete facade, and has been recently painted white to stand out amid the nearby brick structures. Notably, a corner office on the fourth floor that was once occupied by late Gap co-founder Don Fisher has been redesigned to enhance the surrounding workspaces.
Gap's departure from One Harrison coincided with a broader trend of companies reassessing their office needs due to shifts in workplace dynamics ushered in by the pandemic. In 2021, Gap announced it would relocate Old Navy employees from Mission Bay to streamline its workforce at the Embarcadero. By 2023, however, the company, while still headquartered locally, sought to sell One Harrison, reducing its presence in San Francisco.
The revamped One Harrison now boasts an expanded lobby featuring a living green wall and a cafe for tenants, along with a new top-floor bar and upgraded office spaces designed to foster collaboration.
During a recent tour of the transformed property, Sobrato’s co-chief real estate officer, Chase Lyman, highlighted the unobstructed views of the Bay from every floor, the newly created roof deck adjacent to the Bay Bridge, and an upgraded HVAC system designed for maximum efficiency. Lyman also emphasized the building’s robust electrical infrastructure, an essential factor for AI companies that require significant power to develop and support hardware-intensive technologies like robotics.
Notably, the renovation did not include a gym, and the design limited hardwall construction to provide flexibility in how the office space could be utilized.
Reflecting on Sobrato's investment, Lyman acknowledged moments of uncertainty regarding whether the market would respond favorably but reiterated the organization's long-term vision for its portfolio.
“We are looking at this over 30, 50 years,” he stated.
Despite the ongoing challenges in San Francisco’s real estate market, characterized by high office vacancy rates, the AI industry has sparked renewed activity. In the third quarter of this year, the city experienced five consecutive quarters of positive absorption in office space, with the vacancy rate decreasing to 27.7%. Companies such as OpenAI, Anthropic, and Databricks have all committed to substantial leases.
With a wealth of available office space, well-funded AI startups are increasingly in search of large, adaptable headquarters that can be customized to their specific requirements, including the security of exclusive occupancy. Moreover, the demand for research and development spaces is rising, as businesses seek to move beyond traditional office configurations to innovate and test products related to the physical world. Even firms well-known for their software solutions are delving into AI applications that necessitate hardware, although suitable properties featuring high ceilings, structurally sound floors, and sufficient electrical capacity remain scarce in San Francisco.
