2018 a Record-Setting Year to Remember for San Francisco Office Market

Year Ends with More Large Tech Deals, Positive Trends, but Supply Could Impact Growth Ahead SAN FRANCISCO, Calif. – January 10, 2019 – 2018 was a year for the San Francisco history books, according to Cushman & Wakefield’s year-end office market report. The firm’s quarterly publication revealed San Francisco produced a number of records this past year in the dominant office sector, including record high rents and new construction deliveries. In addition, vacancy reached a three-year low, while tenant requirements (demand) held strong. Also favorable to the market’s economic stamina, the most recent San Francisco metropolitan division (San Francisco and San Mateo counties) unemployment rate was a minimal 2.2%, dropping even further below the year ago figure of 2.6%. Year-over-year (YOY) total private sector jobs increased by 2.0% to 1,023,600 while office using positions increased 2.5% to 397,400. Overall San Francisco office market vacancy closed 2018 at just 6.4%, with [...]

MARKETBEAT Office Snapshot Q3 2015, San Francisco

by Derek Daniels Bandwidth of Tech Boom Powers SF Market Employment in San Francisco and the greater metropolitan division (San Francisco and San Mateo counties) continued to break records in Q3 2015. Non-office sectors have certainly been on the rise, with leisure & hospitality up 5.2% and construction and manufacturing up 4.8%. The real driver of the recent jobs boom, however, has been technology jobs, with computer systems design & related services (CSD) adding 12,200 positions or 20.9% year-over-year. In fact, CSD (70,500 positions) should overtake all of financial services (73,500 positions) in total job count by early 2016. Asking Rents Jump 5.2% The overall average asking rent for San Francisco jumped 5.2% in Q3 to close at a record high of $66.71 per square foot (psf), bypassing the previous record of $66.00 psf in Q4 2000. East SOMA took the crown for submarket with the highest asking rent [...]

C&W Northern California In the News – July 2015

Apple Dives into SoMa for First Big S.F. Real Estate Grab SF Business Journal, July 29 The San Francisco office market may get its first big bite of Apple. Apple Inc. is rumored to have leased approximately 76,000 square feet of office space in a South of Market building located at 235 Second Street. Cushman & Wakefield's John Lewerenz represented CBS Interactive, who is the sublessor. Thompson Dorfman Selling Commercial, Residential Sites in Foster City The Registry, July 19 Mill Valley-based Thompson Dorfman Partners is selling an approximately one-acre parcel entitled for 52,000 square feet of commercial development in Foster City. The company also put on the market an approximately 1.5-acre development site approved for 20 townhomes nearby at 1136 Triton Drive. Plans call for the 20 luxury Pilgrim-Triton Townhomes portion of the project to include two- and three-bedroom for-sale units and 48 parking spaces. Real estate brokerage Cushman & Wakefield, is the advisor on [...]

C&W Marketbeat Office Snapshot – Q2

By Robert Sammons Research Director, Northern California Economic Overview Private sector jobs for San Francisco have climbed to a record high of 922,500 as of May 2015, an increase of 39,400 (4.5%) year-over-year. The traditional office divisions recorded an increase of 25,200 positions or 6.9% over that same time period. Not surprisingly, the strongest subsector in office employment has been computer systems design & related services, which climbed by 10,000 positions or 18.2% to 64,800 year-over-year. The unemployment rate tumbled to 3.4% from 4.1% one year ago. Sublease Vacancy Up/ Leasing Activity Down The overall vacancy rate Citywide held steady at 6.4% in the second quarter. Year-over-year, vacancy has dropped 250 basis points (bps) from 8.9%. We feel the disparity between strong job growth and recent flat vacancy is due to two reasons - tenants that signed leases ahead of hiring and are now in the process of absorbing that [...]

NRG Energy Signs Largest Lease North of Market Street This Year

By Cory Weinberg   Power company NRG Energy inked the largest lease north of Market Street this year, taking 51,530 square feet at 100 California St,, landlord Pembroke Real Estate said Monday. In San Francisco overall, the lease is the ninth-largest in San Francisco this year – far behind six-figure leases inked in the South Financial District and South of Market by Uber, Docusign and Lending Club, according to data compiled by Cushman & Wakefield. The energy giant will consolidate parts of the company from Marin County, San Francisco’s South of Market neighborhood and Emeryville into the 55-year-old 100 California office building in November. The company had already moved a cadre of formerly Marin County-based employees into subleased space on the seventh floor of the building. “They wanted great access to public transportation and a great location,” said Mark Anderson, a broker for Cushman & Wakefield who represented NRG. “They’re [...]

SF Could Hit Developers with New Fees to Keep Nonprofits from Fleeing

The view from Howard Street looking east at a proposed 5M high-rise December 12, 2014 Non Profits Splitting Town A San Francisco Business Times article recently revealed a rather interesting statistic: Approximately a quarter of the nonprofits in the City packed their bags and left town between 2011 and 2013. Business Times reporter Cory Weinberg interviewed Steven Wertheim, Project Manager at the San Francisco Planning Department, Peter Cohen, Co-Director of the Council of Community Housing Organizations and Cushman & Wakefield's Research Director Robert Sammons to get their insights on this trend. Among other things, Sammons said developers already feel the squeeze from the annual Prop. M office space cap, which could delay new projects starting in 2015. New fees would be a “slippery slope” to making office projects unfeasible, he said. Peter Cohen's take on the situation is that he feels we are in the midst of  "a serious problem in the central city [...]