KPMG has opened a roughly 96,000-square-foot office at 505 Howard Street, placing the Big Four firm in the downtown corridor often marketed as San Francisco AI Alley. The move is notable because KPMG is shrinking its footprint while relocating near Anthropic and Salesforce. Here is what the shift means for the city’s evolving office market.
Key Takeaways
- KPMG opened its new San Francisco office at 505 Howard Street in September 2026 after signing a long-term lease in 2024.
- The firm is taking roughly 96,000 square feet, down from about 143,000 square feet at its longtime office at 55 Second Street.
- Anthropic has built a substantially larger Howard Street presence than the original 200,000-square-foot figure suggested, including space at 500 and 505 Howard and a full-building commitment at 300 Howard.
- Landlords, brokers and companies have increasingly used the informal “AI Alley” name for the Howard Street corridor.
- San Francisco office leasing has improved in 2026, although overall vacancy remains elevated and hybrid work continues to shape demand.
KPMG Opens Roughly 96,000 Square Feet at 505 Howard
KPMG opened its new San Francisco workplace at 505 Howard Street in September 2026, completing a relocation first announced two years earlier. KPMG’s official location directory now lists 505 Howard Street as its San Francisco address.
The firm signed its long-term lease in 2024 after deciding to leave 55 Second Street, where it had occupied about 143,000 square feet. Commercial real estate reports put the new lease at roughly 96,000 square feet across three floors, reducing KPMG’s local office footprint by about one-third.
That smaller footprint makes the move more nuanced than a straightforward expansion story. KPMG is committing to downtown San Francisco while also adjusting its real estate needs for a workforce operating under a hybrid model.
The location itself was part of the calculation. Chris Cimino, managing partner of KPMG’s San Francisco office, told the San Francisco Standard, “We knew this area was going to be the place to be, and we wanted to be in the mix.”
A Smaller Footprint Comes With an AI-Focused Workspace
KPMG’s move changes not only its address but also how the firm intends to use its San Francisco office.
The new workplace includes KPMG’s first West Coast “Ignition Center,” a dedicated space designed for teams and clients to work on data, technology and artificial intelligence projects. KPMG has described the centers as collaborative environments where clients can develop and test potential solutions with the firm’s advisers.
The combination of a smaller overall footprint and more specialized collaborative space reflects a broader change in office strategy. Companies are increasingly evaluating workplaces by how employees and clients use them rather than simply maintaining the amount of space they occupied before the pandemic.
For KPMG, the location also puts its audit, tax and advisory teams close to companies operating at the center of San Francisco’s AI economy.
Anthropic’s Expansion Gave Howard Street Its AI Alley Identity
The strongest reason for the “AI Alley” label is Anthropic’s rapid expansion along Howard Street.
Anthropic established its headquarters at 500 Howard Street in 2023 and later added space at 505 Howard Street. In February 2026, DivcoWest and Blackstone Real Estate announced that Anthropic had leased all of the 466,000-square-foot office tower at 300 Howard Street, along with the adjacent 342 Howard property.
That expansion means Anthropic’s Howard Street presence is substantially larger than the approximately 200,000-square-foot figure sometimes associated with the company. Recent reporting described roughly 200,000 square feet at 500 Howard alone, in addition to its other nearby commitments.
The “AI Alley” designation remains informal. Reporting indicates that landlords, commercial real estate brokers and businesses in the area have adopted the name as Anthropic and other technology companies have concentrated operations around Howard Street and Salesforce Park.
Artificial intelligence office activity is also extending beyond the immediate corridor. Exa’s Mission District headquarters provides another example of an AI company committing to substantial physical space elsewhere in San Francisco.
KPMG’s Move Reflects an Uneven Office Recovery
KPMG’s relocation arrives as San Francisco’s commercial office market shows clearer signs of improvement, but the recovery remains incomplete.
Major commercial real estate firms reported overall citywide vacancy of roughly 28 percent to 30 percent in the second quarter of 2026, depending on methodology. Cushman & Wakefield reported a 30.1 percent vacancy rate, down from 33.8 percent a year earlier, while Colliers measured vacancy at 28 percent. CBRE reported 29.2 percent.
Cushman & Wakefield also found that technology companies accounted for approximately 54.9 percent of active tenant demand at the end of the quarter. The South Financial District and Mission Bay were among the areas contributing most strongly to positive absorption.
Those figures provide important context for KPMG’s move. New leasing activity is returning to downtown, particularly from technology and AI companies, but KPMG itself is moving into less space than it previously occupied.
Hybrid work remains another part of that picture. Persistent Bay Area remote work has continued to influence office attendance, leasing decisions and the amount of space employers require.
Howard Street Adds a Major Tenant, Not Another AI Company
KPMG’s arrival should not be interpreted as another AI company moving into the corridor.
Photo Credit: Unsplash.com
The firm remains a professional-services organization providing audit, tax and advisory services. Its significance to San Francisco AI Alley is primarily geographic, although KPMG has increasingly incorporated artificial intelligence into its consulting work and its new office includes the AI-oriented Ignition Center.
Its presence broadens the mix of businesses occupying Howard Street. Anthropic supplies much of the corridor’s AI identity, Salesforce remains a major nearby technology presence, and KPMG adds a large professional-services tenant serving corporate clients across multiple industries.
That distinction also makes the relocation relevant to the wider downtown office market. A recovery driven only by rapidly expanding AI companies would be narrower than one that also attracts or retains established firms from other sectors.
The Move Adds Another Layer to San Francisco AI Alley
KPMG’s opening at 505 Howard Street captures two trends occurring simultaneously in downtown San Francisco.
Artificial intelligence companies are creating substantial demand for office space, particularly around Howard Street, while established employers continue to reconsider how much space they need in a hybrid-work environment.
KPMG sits at the intersection of those trends. It has reduced its total San Francisco footprint but maintained a major downtown presence, moved closer to one of the city’s largest concentrations of AI businesses, and dedicated part of its new workplace to technology-focused client work.
For San Francisco AI Alley, the result is a more diverse business cluster rather than simply another technology lease.
Frequently Asked Questions
Where is KPMG’s new San Francisco office located?
KPMG’s new San Francisco office is at 505 Howard Street in the South Financial District. The building is known as Foundry Square III and is located near Salesforce Park.
What is San Francisco AI Alley?
San Francisco AI Alley is an informal name increasingly used for the Howard Street corridor where Anthropic and other technology operations have concentrated. It is a real estate and business-sector designation rather than an official city neighborhood name.
How large is KPMG’s new San Francisco office?
Commercial real estate reports place KPMG’s new office at roughly 96,000 square feet across three floors. That is about one-third less space than the approximately 143,000 square feet the firm previously occupied at 55 Second Street.
How large is Anthropic’s Howard Street presence?
Anthropic occupies substantial space at 500 and 505 Howard Street and has committed to the entire 466,000-square-foot building at 300 Howard Street. Its Howard Street footprint therefore extends well beyond the approximately 200,000 square feet associated with its earlier headquarters space.
When did KPMG sign the lease at 505 Howard Street?
KPMG signed the long-term lease in 2024, with the relocation planned for September 2026. The firm opened the new workplace as scheduled in September 2026.
