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Developer bulks up tech office plans for Flower Mart

Kilroy Realty Corp. wants the $350 million South of Market office campus built atop the current Flower Mart site to be bigger and taller than it first expected.

Kilroy recently filed its first proposal that outlines what it wants the whole site to look like – and it wants a Salesforce Tower-sized amount of office space. Plans show that the 5th and Brannan Streets site would include about 1.5 million square feet of offices spread across three buildings that range in height up to 250 feet tall. That's about 300,000 square feet more than Kilroy had previously discussed and could make the project the biggest office proposal in the San Francisco pipeline.

The height far exceeds what the two-year-old draft of the Central SoMa rezoning plan limits, but that idea already has some backers. SoMa neighborhood leader John Elberling, who runs the Tenants and Neighbors Development Corp., in December proposed that the city allow Kilroy to build taller to help the project pay for a new Flower Mart facility.

"What we've done is respond to what we've been hearing in the community, especially from community leaders, that density is appropriate for this site, and that a project of this scale will help us create a new state-of-the-art Flower mart that will be successful," said Mike Grisso, a senior vice president at Kilroy.

The developer is also pitching 45,800 square feet of retail and 115,000 square feet of warehouse space for the new Flower Mart. It announced late last year that it would spend $80 million to build a new wholesale flower market below ground to guarantee that the landmark site survives in the same location.

Even before the developer acquired the whole site last year, some progressives have winced at the idea of tech offices replacing middle-class distribution jobs that have been in SoMa for decades. That incited negotiations between the flower vendors (represented by progressive politicians like Art Agnos and Aaron Peskin) and Kilroy to keep them on site and at affordable rents.

Agnos said Friday that the talks have been "substantive" but must resolve soon before the tenant group has to file signatures to get a November ballot measure that would try to halt or alter the project. He said the sides are still negotiating over rents and whether the new Flower Mart will be above-ground or below the surface.

"We have achieved some agreement on issues but the basic issues have not been resolved," Agnos said.

Kilroy may also have another major headache on its hands because the city likely won't have have enough office space to allocate to the project when the developer seeks approvals by the end of next year. The office space cap under the 1986 ballot measure Prop. M will likely keep developers, particularly in Central Soma, waiting for approvals.

"We're anxious to work with the city to see what will be possible," Grisso said.

Grisso declined to comment on whether Kilroy has been in talks with tenants already to lease the new office complex.

Here's what the publicly traded real estate investment trust is pitching with the three new office buildings all on the site:

  • a 65-foot-tall building, 119,000-square-foot office building at 6th and Brannan

  • a 250-foot-tall tower with a 77-foot podium, which combine to span 490,050 square feet

  • a complex that include a 225-foot tower, a 200-foot tower, a 150-foot building and a 77-foot podium, which all combine to span 971,400 square feet

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