The artificial intelligence startup Sierra is set to sign its third office lease in San Francisco in as many years. The firm, headed by OpenAI Chair Bret Taylor, plans to take 300K SF at 185 Berry St. The two-building complex, known as China Basin, is also home to Lyft’s headquarters.
The deal is expected to close imminently, according to the San Francisco Business Times, which reported the potential lease on Monday, citing anonymous sources.
China Basin in San Francisco
Sierra’s growing San Francisco office portfolio also includes two separate 40K SF blocks at 235 Second St. It isn’t clear yet whether the company plans to retain those existing leases. The terms of the 185 Berry St. lease aren’t yet confirmed.
This comes after Salesforce announced a $15B investment in San Francisco’s AI sector. The money will go toward an AI incubator hub and workforce development programs in a push to establish the city as the global epicenter of the AI industry.
The AI real estate race took off in 2024, when OpenAI led the charge with a 315K SF lease in Mission Bay in the fall. Databricks signed a lease for a 150K SF headquarters at the One Sansome building in March. Harvey AI signed a 92K SF lease at 201 Third St. in July.
Eighty-three AI firms have combined to lease nearly 1M SF in the city this year.
Through the first half of 2025, the Bay Area captured $55B in venture capital funding for AI, 78.2% of the nation’s total.
In the Bay Area, 78.2% of total VC funding this year has gone to AI companies. The hot streak picked up steam this year, with the region clocking its sharpest quarterly drop in vacancy in 10 years in the second quarter.
But leases had been trending toward smaller footprints and shorter terms as AI companies stayed conservative in the nascent startup phase of their evolution.
Sublease vacancy in San Francisco fell in Q3 for the fifth quarter in a row, driven by tech and AI startups pursuing short-term opportunities, according to Cushman & Wakefield.