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Personal motivation Watching his mother die of cancer completely changed the course of Mike Quigley’s career. RON LEUTY, 35 COVER STORY PROP. M IN THE TECHFLASH The ig is up Gig workers can celebrate legislation that turns most of them BALANCE into employees, but gig economy companies have fresh worries. DAWN KAWAMOTO, 8 BANKING Shorting S.F. Chubbies Shorts was born and bred in S.F., but it’s joining the California exodus and taking 65 jobs to Texas. MARK CALVEY, 14 Residential builders and In the name of addressing a growing jobs-housing projects 20 imbalance, some activists want to make San Francisco’s 30-year-old office development restrictions even tighter. ADVERTISEMENT FIONA KELLIHER, page 18 GETTY IMAGES / CLASSEN RAFAEL / EYEEM / RAFAEL CLASSEN / GETTYIMAGES SAN FRANCISCO Breaking news online BUSINESS TIMES r SanFranciscoBusinessTimes.com September 20, 2019 Vol. 34, No. 10, $10.00 On Facebook, Twitter and Instagram 275 Battery St. @SFBusinessTimes Suite 600 San Francisco, CA 94111 Daily email updates L SanFranciscoBusinessTimes.com/newsletters 2 SAN FRANCISCO BUSINESS TIMES UPFRONT Your primer for the week in Bay Area business news NEED TO KNOW THREE THINGS THAT HAPPENED WHILE WE DANCED IN THE RAIN NEW IPHONE CREEPS 2 OUT CONSUMERS The placement of the iPhone 11 Pro’s three camera lenses evoke 1 TWITTER POSTS the multiple beady-eyed stare of IN PAPER AND a dangerous insect, according to experts, triggering a little-known CONCRETE fear called “trypophobia.” The lines between our GETTY / SFBT ILLUSTRATION digital lives and physical environment blurred a bit more for Tenderloin pedestrians and BART riders. Twitter stenciled tweets on sidewalks and 3 WE WILL WAIT plastered them on walls. A LITTLE BIT Next up: Smoke tweets in WeWork parent The We Co. postpones the sky by the Blue Angels? planned IPO, thus buying more time to explain why signing money-losing office l ases all over the world is a great business model worth $47 billion. TODD JOHNSON GETTY / XTOCKIMAGE CORRECTIONS ABOUT US Fair and accurate coverage is at the heart of our The entire contents of this newspaper are copyrighted 2019 by The San Francisco Business Times, a publication of Business Journal Publications Inc., with all rights reserved. Reproduction or use, without permission, of editorial mission. We will promptly print corrections of substantive or graphic content in any manner is prohibited. Single Copy: $10, Bay Area Book of Lists: $81. Back issues are % errors. If you believe incorrect or unfair information San Francisco Business Times is a publication available for $10. Periodicals Postage Paid at San Francisco, California, and at additional mailing offices. The San has appeared in the San Francisco Business Times, of: American City Business Journals, Francisco Business Times (ISSN 0890-0337) is published weekly by Business Journal Publications Inc. 275 Battery 120 W. Morehead St., Charlotte, N.C. 28202 St., Suite 600, San Francisco CA 94111. Subscriptions are 1‑year print and digital, $140, 1‑year digital, $115. please contact Managing Editor Jim Gardner. Whitney Shaw, CEO Postmaster: Please send address changes to: San Francisco Business Ray Shaw, Chairman (1989-2009) Times, 275 Battery St., Suite 600, San Francisco CA 94111 SEPTEMBER 20, 2019 3 RISE & FALL DECISIVE Who was favored by fortune this week? Who wasn’t? STANFORD’S UNICORNDATA STABLE JANET 16.9 percent of S.F. unicorn founders are NAPOLITANO undergraduate attendees of Stanford University. University of California president announces she will step down, saying that many top priorities — balanced STANFORD UNIVERSITY tuition policies and 10 research across campuses — have been accomplished. HARVARD UNIVERSITY 4 UNIVERSITY OF CALIFORNIA UNIVERSITY OF WATERLOO (Canada) 4 PETER THIEL Silicon Valley celebrity’s Mithril Capital, named after a magical metal, gleams UNIVERSITY OF CALIFORNIA, BERKELEY 3 a little less brightly as federal investigators look into the VC firm’s financial EVERYWHERE ELSE conduct and practices. 35 WASHINGTON UNIVERSITY 3 SOURCE: COMPANIES, AND LINKEDIN PROFILES BizSpotlight ADVERTISING SECTION ACCOUNTING | EXPANSION SEILER LLP EXPANDS SAN FRANCISCO BAY AREA REACH WITH NEW WALNUT CREEK OFFICE Seiler LLP 1340 Treat Boulevard, Suite 500, San Francisco, CA seiler.com Seiler LLP, one of the nation’s leading advisory, tax and accounting fi rms in the high-net-worth space, is pleased to announce it has expanded its physical footprint into the East and North Bay with the opening of a state-of-the-art new o ce in Walnut Creek. 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To start your BizSpotlight and claim your introductory $50 credit or get help with your press release please contact James Beckner. (415) 288-4930 | [email protected]. 4 SAN FRANCISCO BUSINESS TIMES Blanca Torres and Fiona Kelliher STRUCTURES cover real estate I [email protected] @SFBTBLANCA I [email protected] SALES The Leamington building, opened as a hotel in 1926, is set to house a growing coworking concept. COMING SOON WEWORK GRABS Brick & Timber’s Glenn Gilmore, Patrick Tostado and Jesse Feldman: ”Jackson Square SPACE FOR THIRD is a slice of S.F. that’s architecturally unique.” OAKLAND LOCATION TODD JOHNSON WeWork is planning to open a third Oakland location to house its headquarters concept that caters to small and midsize business, according Coming back for more to sources familiar with the deal. A division of We Co., the company is the Bay Area’s largest coworking Investor expands its Jackson Square portfolio with two more deals operator with over 30 outposts totaling more than 1.26 million square feet, Glenn Gilmore and Patrick Tostado of more than 200,000 square feet of EastWest Bank, package application according to Business Times research. remember walking past 450 Pacific office space in San Francisco and Pas- company Bitmami, and information The company leased close to 37,000 square feet in the Leamington Building, St., a four-story brick office building adena. Seven are in Jackson Square or technology company Novani LLC. a former hotel turned office building at in San Francisco’s Jackson Square, the nearby North Waterfront. “Th re’s not a ton of opportunity 1814 Franklin St. WeWork declined to and thinking it would be cool to own Thefirm has reached $150 million to buy buildings in Jackson Square, comment for this story. The landlord, that building. in assets under management, and but what Brick & Timber do well is Harvest Properties, did not respond to Four years later, they do. the staff has grown from a two-per- that when there is an opportunity, a request for comment. Harvest and a partner bought the Th ir firm, Brick & Timber Collec- son operation of Gilmore and Feld- they move quickly,” said Mike Taqui- Leamington in 2015 for $19.1 million, tive, spent more than two years work- man to six people. Tostado recently no, a broker with CBRE who handled according to PropertyShark. WeWork’s ing out a deal to buy the 28,586-square- joined full time as general counsel the sale of 450 Pacifi along with Kyle space in the historic building will be foot building for $31.7 million, or after working on a contract basis. Kovac, also of CBRE. spread over three floors. about $1,110 per square foot. Brick & Timber, founded about Taquino and Kovac also worked WeWork first arrived in Oakland in 2017 with about 80,000 square feet The sale closed this week on the seven years ago, typically looks for with Brick & Timber when the firm in 1111 Broadway and then leased a heels of Brick & Timber buying 900 buildings to renovate into modern acquired the 45,000-square-foot 55 second, 68,000-square-foot location in Kearny, a 31,200-square-foot building office space that can attract top-of- Green St. for $29 million, or about TMG Partners’ 2201 Broadway. for $27 million, or $865 per square foot. the-market rents. $644 per square foot, according to Whereas most WeWork locations “These acquisitions represent the The seller of 450 Pacific is Keesal, property records. Six months lat- offer a mix of common work areas and private offic s, headquarters offers growth of our foothold in this sub- Young & Logan, which bought the er, car-sharing company Getaround tenants their own space within a shared market,” said Jesse Feldman, Brick building in 2007 for $7.8 million and leased up the entire building to move or flex office spac . WeWork opened a & Timber vice president. “Jackson renovated it in 2009. Thelaw firm will its headquarters. headquarters location in San Francisco Square is a slice of San Francisco that lease back the space for six months At 353 Kearny, Brick & Timber last year. is architecturally unique in both its before moving out. Brick & Timber revived a dilapidated building and The flex office option is g owing fast, with another operator, Knotel, planning history and preservation.” hired commercial brokerage CBRE to leased it to Canopy, a high-end bou- to reach 1 million square feet in San San Francisco-based Brick & Tim- find a single tenant to take over.