California Stem Cell Agency Saying So Long to San Francisco

The new HQ location for the California stem cell agency

The city of Oakland does not have the same snap and sizzle as San Francisco, but it will soon have something that the famed city-by-the-bay will not have – the headquarters of an internationally known, $3 billion, stem cell research agency.

California’s taxpayer-financed program, which is arguably the largest, single source of stem cell research funding in the world, is leaving San Francisco this fall and moving across the bay to the sunnier and cheaper climes of Oakland.

The reason is that the agency is no longer the beneficiary of free space in San Francisco and can’t afford to pay sky-high rent to stay there.

Red bubble shows location of new CIRM HQ -- Google map

The new address for the California Institute for Regenerative Medicine (CIRM), as the agency is formally known, will be 1999 Harrison St. in Oakland.  CIRM will be housed on the 15th and 16th floors of a granite-clad building overlooking Lake Merritt in the downtown area.

In San Francisco, the agency’s neighbors included Happy Donuts, which also sold Louisiana fried chicken, and the San Francisco Giants baseball park.  In Oakland, its neighbors will include the FBI and Cerexa, Inc., a biotech firm owned by Forest Laboratories of New York. If CIRM workers are missing Happy Donuts fare, Oakland's famous Chicken&Waffles restaurant is only 15 minutes away on the bus.

The stem cell agency enjoyed its rent free location as the result of a bidding war in 2005 among cities in California to acquire the agency headquarters. San Francisco offered a package that it calculated at $18­­­­­­­ million. It also helped San Francisco that Bob Klein, the first chairman of the agency, lived on the San Francisco peninsula.

The agency and its auditor estimate that CIRM saved $12 million in rent and related benefits during the 10 years it has been in San Francisco. That money, however, will ultimately be spent on research or agency expenses.

That includes the rent for the new digs that will run $697,560 annually. The base rate for the 17,097 square feet is $3.40 a foot. The agency will have 14,411 square feet on the 16th floor of the 27-story building and 2,686 on the 15th. 

In response to a query, Kevin McCormack, CIRM’s senior director for communications, said,

“The term for the 16th floor is five years; the term on the 15th floor is three years, with an option to extend by two years to be coterminous with the term on the 16th floor.  This will provide CIRM with the flexibility to reduce its space and rent burden, depending upon the circumstances.”

The agency is expected to run out of cash for new awards in less than five years but will have ongoing functions related to its existing awards.

Costs for tenant improvements are still being calculated along with costs for the move.

Under the San Francisco lease, the owner provided free parking, a significant benefit for the agency employees, which number about 55.  Parking can run to $15 to $20 a day in the agency's current neighborhood, according to sanfrancisco.bestparking.com.

In Oakland, employees will have to pay for their own parking, but the agency is looking into government assistance programs. The location is near a BART station, a mass transit overhead rail system that runs through much of the San Francisco Bay Area.

Over the years, Oakland has presented a changing face to the public. In World War II, it was part of what was described as a “second gold rush” as the result of defense plant operations. In 1966 , the city was the headquarters of the Black Panthers, whose co-founder, Huey Newton, attended high school there. Today Oakland is involved in a wave of gentrification that has created tension­­ within the community.

It may be fitting for the agency to return to what is known as the East Bay area in California. Its first, temporary headquarter was located in Emeryville, just three miles up the road from its new space.