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The company has leased 87,000 square feet of office space at 185 Berry Street near AT&T Park, in one of the most significant private lease deals signed in San Francisco this year.
Currently, Dropbox employs 65 people based at 760 Market Street, though the company is planning on expanding to up to 400 employees.
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The four-year-old company has 25 million users who can organise files across various computers and mobile units.
Dropbox has stated that it wants to be a “creative space for creative people who love to build things.”
The company was founded in 2007 by Drew Houston and Arash Ferdowsi and had its initial release in September 2008.
According to Dropbox, the initial idea for the service came from Houston, who had a habit of forgetting his USB drive while a student. Houston stated that services at the time “suffered problems with internet latency, large files, bugs, or just made me think too much.”
Last year Dropbox’s revenues were USD 100 million and the company is currently valued at USD one billion.
Both Dropbox’s server and desktop client are written in Python and let users put any file into a designated folder that is then synced with Dropbox’s Internet service
Meanwhile, a significant competitor to Dropbox has emerged called Yousendit, which also uses cloud-based storage technology.
Brad Shimmin, an analyst at Current Analysis was quoted in itproportal as saying: “This makes sense as a business play because smaller tools like YouSendIt are easy to adopt. They make file-sharing easy and can remove the need to buy servers.”
In order to compete with Dropbox the new outfit is offering multi-level plans which have cost effectiveness uppermost in mind.
Editor’s notes: In 2017, Dropbox signed the biggest office lease ever in San Francisco, securing 736,000 square feet over 15 years in the city’s Mission Bay neighbourhood.
The company signed a pre-lease deal at The Exchange which was developed by Kilroy Realty Corporation. Dropbox’s lease was due to start at the end of 2018.
In February 2023, it was announced that the company had recorded a real estate impairment of $162.5 million in the fourth quarter of 2022, bringing the markdown for the year to $175.2 million.
The market downturn following the pandemic hit San Francisco particularly hard. This was partly due to the market being so heavily occupied by the technology sector – a sector that was slow to return to the office, and has adopted hybrid or fully remote working policies.
The company had advised that it was quick to market its subleasing plans but the market had deteriorated significantly.
In Q1 2023, San Francisco had the highest office space vacancy rate in the U.S. at 26.8 per cent.