Dropbox struggled to sublease space in its massive headquarters after signing a record lease in 2017 and then getting hit with a pandemic and market downturn.
Dropbox made splashy headlines in 2017, when the software company signed the biggest office lease ever in San Francisco, securing 736,000 square feet over 15 years in the city’s Mission Bay neighborhood.
The combination of a global pandemic in 2020, which led to a boom in remote work, followed by a downturn in the tech market last year has turned that massive space into a financial albatross with an original minimum commitment of $836 million. As of September, that number sat at $569 million.
Dropbox said in its fourth-quarter earnings statement on Thursday that it recorded an impairment in the period of $162.5 million „as a result of adverse changes in the corporate real estate market in the San Francisco Bay area.“ Its total real estate impairment for the year was $175.2 million, which is still well below the $400 million hit the company took in late 2020.
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