{"id":27604,"date":"2023-07-28T13:36:04","date_gmt":"2023-07-28T20:36:04","guid":{"rendered":"https:\/\/occupysf.net\/?p=27604"},"modified":"2023-07-28T13:36:05","modified_gmt":"2023-07-28T20:36:05","slug":"commercial-real-estate-in-san-francisco-finally-gets-good-news-in-office-demand-data","status":"publish","type":"post","link":"https:\/\/occupysf.net\/index.php\/2023\/07\/28\/commercial-real-estate-in-san-francisco-finally-gets-good-news-in-office-demand-data\/","title":{"rendered":"Commercial real estate in San Francisco finally gets good news in office demand data"},"content":{"rendered":"\n

By\u00a0Stephen Council<\/a> July 26, 2023 (SFGate.com)<\/p>\n\n\n\n

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San Francisco’s high office vacancy rate has sparked worries that property tax revenue will plummet, leading to cuts in city services.Mit Desai \/ 500px \/ Getty Images<\/em><\/a><\/a><\/a><\/p>\n\n\n\n

San Francisco\u2019s commercial real estate fortunes may finally be turning.<\/a><\/p>\n\n\n\n

Office demand in the city increased 10.2% in the second quarter of 2023 compared with the first quarter, according to data from real estate tech firm VTS<\/a>. The researchers also found that the city has, since March, seen more prospective office tenants looking for spaces larger than 50,000 square feet.<\/p>\n\n\n\n

The report comes after San Francisco\u2019s office vacancy rate hit a\u00a0record-high<\/a>\u00a029.4% in the first quarter of 2023 \u2014 January through March \u2014 and indicators pointed to a potential further rise. Despite pushes by major tech firms like\u00a0Salesforce<\/a>\u00a0and\u00a0Meta<\/a>\u00a0to get workers back in the office, the Bay Area has the\u00a0highest percentage of remote workers<\/a>\u00a0of any U.S. metro area. (Wealthier workers<\/a>\u00a0are more likely to work from home, as are, of course, employees who can do their jobs on a computer.)<\/p>\n\n\n\n

San Francisco\u2019s office vacancies, in tandem with the exit of key retail businesses like Westfield San Francisco Centre<\/a>, have sparked anxieties about the future of downtown San Francisco. This includes worries<\/a> that the city\u2019s property tax incomes will plummet, leading to city service cuts. <\/strong>Westfield is giving up<\/a> its San Francisco Centre property after falling to 55% occupancy.<\/p>\n\n\n\n

But the VTS data is a bright spot for the city\u2019s commercial real estate landlords and downtown businesses. The firm calls<\/a> its office demand index \u201cthe earliest look into the health of the office market.\u201d Using touring activity, VTS measures demand by tracking the percentage of total office space prospective tenants are looking to rent.<\/p>\n\n\n\n

The growing demand has been driven in part by the explosion of new artificial intelligence companies, VTS CEO Nick Romito told Bloomberg<\/a>, which first wrote about the report. Though a new San Francisco-based AI startup<\/a> seems to emerge every week, much of the nascent technology\u2019s development appears to be centered south of the city at Mountain View-based Google<\/a>, Menlo Park-based Meta<\/a> and Santa Clara-based Nvidia<\/a>. <\/p>\n\n\n\n

New York and San Francisco were the only mentioned cities with year-over-year demand growth last quarter;\u00a0VTS found that office demand went down in Los Angeles, Seattle,\u00a0Chicago, Boston, and Washington, D.C.\u00a0<\/p>\n\n\n\n

San Francisco has a long way to go in filling up or converting<\/a> its floors of empty workspace. The city\u2019s office demand is still shy of Los Angeles\u2019 and New York\u2019s, according to VTS, and a commercial real estate researcher told SFGATE in April that vacancies may peak<\/a> next winter.<\/p>\n\n\n\n

Hear of anything happening at a Bay Area tech company? Contact tech reporter Stephen Council securely at stephen.council@sfgate.com or on Signal at 628-204-5452.<\/em><\/p>\n\n\n\n

By\u00a0Stephen Council<\/a><\/a><\/p>\n\n\n\n

Stephen Council is the tech reporter at SFGATE. He has covered technology and business for The Information, The Wall Street Journal, CNBC and CalMatters, where his reporting won a San Francisco Press Club award. Signal: 628-204-5452 Email: stephen.council@sfgate.com<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

By\u00a0Stephen Council July 26, 2023 (SFGate.com) San Francisco’s high office vacancy rate has sparked worries that property tax revenue will plummet, leading to cuts in city services.Mit Desai \/ 500px \/ Getty Images San Francisco\u2019s commercial real estate fortunes may finally be turning. Office demand in the city increased 10.2%… Continue reading → <\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[475],"_links":{"self":[{"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/posts\/27604"}],"collection":[{"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/comments?post=27604"}],"version-history":[{"count":1,"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/posts\/27604\/revisions"}],"predecessor-version":[{"id":27607,"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/posts\/27604\/revisions\/27607"}],"wp:attachment":[{"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/media?parent=27604"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/categories?post=27604"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/occupysf.net\/index.php\/wp-json\/wp\/v2\/tags?post=27604"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}