Calco Commercial Real Estate has leased 2070 Newcomb Avenue: 7,500+/- square feet of totally clear span warehouse with 28-30′ ceilings, substantial power, fully sprinklered and a side yard with private parking. 2070 Newcomb is located in the Bayshore Corridor area, just two blocks from the San Francisco Produce Market, and within close proximity to public transit.

If you have any questions about other available commercial real estate listings or the status of the San Francisco real estate market place, call 415.970.0000.

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Commercial property prices are approaching the levels seen during the last boom, according to leading price indices.

“Average sale prices for core multifamily and office properties in major markets have soared well above their 2006–07 average,” reads a June report from CoStar Realty Information Inc. “Investors continued to aggressively pursue those types of properties.”

As prices rise, investors seem torn between pouring more money into the most expensive assets and investing in properties that may have more potential for future appreciation. Meanwhile, the overall liquidity of the market continues to improve as the bid/ask gap shrinks and properties spend less time on the market.

June statistics from the Moody’s Real Capital Analytics Commercial Property Price Indices show continued steady growth in prices, bringing the index just 4.8 percent below its November 2007 peak.

Digging into the numbers, six of the 23 Moody’s/RCA’s indices are now higher than their peaks before the crisis, including apartment buildings in major markets; apartment and office properties in central business districts (CBDs) in major markets; office buildings in CBDs in non-major markets; major markets aggregate and retail in major markets.

Suburban office buildings in non-major markets have experienced the slowest recovery, regaining just over 30 percent of their peak-to-trough loss.

Future returns

Recently, non-major markets and less-favored property types have been gaining on the CPPI.

Appreciation for most asset types rose ahead of apartment properties, the long-time favorite, in the CPPI numbers for both April and the last 12 months.

The largest and most expensive properties have led the recovery in real estate prices and have an outsized importance in CoStar Group’s U.S. Composite Index, which in April had recovered to within 2.2 percent of its prior peak, according to CoStar’s June report. The prices for the priciest properties kept marching higher in April. The composite index advanced 2 percent in April 2014, according to CoStar.

Less expensive properties, however, show more potential to grow because they are still far below their old peak prices. CoStar’s equal-weighted U.S. Composite Index is 21.9 percent below its prior peak. An equal weighted index gives the same weight, or importance, to each asset in the index. So the smallest properties are given equal weight to the largest properties.

Throughout the first quarter of 2014, apartment properties showed a relatively weak total return of just 2.21 percent, according to the National Council of Real Estate Investment Fiduciaries (NCREIF). That’s the lowest total return for apartments since the first quarter of 2010. Part of the reason behind the weak returns is that appreciation is slowing for apartment properties. The 0.99 percent appreciation showed by NCREIF is also the slowest since the first quarter.

As investors become more optimistic about the broader economy, they are putting more money into other property types. Retail continued to lead the NCREIF index in the first quarter of 2014, with total returns of 4.3 percent. Investors are betting that a rising economy with help lift retail properties, which still suffer from relatively high vacancies in many markets.

“Despite the strong return performance, the fundamentals were poor,” according to NCREIF.

No haggling over price

The average difference between the prices sellers ask for their properties and the final sales price shrank by more than 1 percent over the 12-month period that ended in April. The sales price to asking price ratio was 88 percent that month, according to CoStar. The change shows improved liquidity in the investment sales market.

“Multifamily properties are driving much of this improvement,” say CoStar researchers. That’s especially true in core markets. For apartment properties in Los Angeles, San Francisco, Boston and New York, the average difference between asking prices and sales prices has shrunk to 2006-07 levels, according to CoStar.

In another measure of improving liquidity, the average time a for-sale property spends on the market shrank 3 percent to 417 days over the 12 months ending in April, and the share of properties pulled off the market by discouraged sellers also dropped by more than 2 percent, CoStar reports.

Source: National Real Estate Investor
http://nreionline.com/finance-investment/commercial-property-price-indices-approach-new-highs

Calco Commercial leased 2,863+/- square feet of ground floor creative office space in the central Mission location of 3130 20th Street to a consumer-oriented 3-D printer company. 3130 20th Street is situated in close proximity to multiple restaurants, shops, and public transportation.

For more information on Calco Commercial’s other available commercial properties/listings, call our office at 415.970.0000.

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238 Capp Street is now being offered for SALE or LEASE. On a sale basis, the total building size is 7,874+/- square feet (per RealQuest) which is divided among two floors. 238 Capp Street is in the Mission Street NCT (Neighborhood Commercial Transit) Zoning Area, which allows for residential development and related uses. The building is of concrete construction with 15′ ceilings, one (1) large drive-in loading door, and is being offered for $3.8 Million.

On a lease basis, 238 Capp Street has 3,220+/- square feet of ground floor warehouse (with drive-in loading door) and 814+/- square feet of second floor office/creative space for $7,950.00 per month. The second floor office area can be leased separately at $2,685.00 per month.

If you have any questions about this listing or our other available properties, call 415.970.0000.

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Calco Commercial Real Estate has listed 238 Capp Street for lease. This 4,034+/- concrete Inner Mission space consists of 3,220+/- square feet of ground floor warehouse with one (1) large drive-in loading door and 15′ ceilings, and 814+/- square feet of second floor office/creative space.

238 Capp Street is leasing for $7,950.00 per month. The second floor office area can be leased separately at $2,685.00 per month. This property is located in close proximity to the vibrant Valencia Street corridor, a multitude of shops, restaurants and BART.

For more information regarding Capp Street, our other listings, or market conditions, call our office at 415.970.0000.

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After representing the Buyer in the sale of the 321-323 Allerton Avenue property in South San Francisco in April, Calco Commercial Real Estate is now marketing the property for Lease. The 10,000+/- commercial office building can be divided to two (2) units, boasts a new roof & HVAC. The property includes on-site private parking for 42 cars. The Owner can provide build-to-suit interior.

For more information on this listing or Calco’s other available properties, call 415.970.0000.

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Two developers think big in SoMa: Plans to add 1 million square feet of office space

Blanca Torres
Reporter-
San Francisco Business Times
source: www.bizjournals.com/sanfrancisco

CIM Group and SKS Partners are each looking to build SoMa highrise office towers that could add 1 million square feet in total to San Francisco’s hot office development pipeline.
Both projects fall under the Western SoMa Plan, a set of development guidelines adopted in late 2012 that allow for taller buildings in the neighborhood.

These are the proposals:

San Francisco-based SKS Partners submitted an early plan to the city’s planning department for a 160-foot tall, 688,000-square-foot office building at 610 and 620 Brannan St. The site was previously controlled by Zappettini Properties, a firm that wanted to build a 567,000-square-foot office building on the southeastern corner of the San Francisco Flower Mart. The property partially contains a surface parking lot and smaller buildings occupied by flower market tenants. The parcels together represent less than 10 percent of the Flower Mart facilities.
Los Angeles-based CIM Group plans to demolish an existing, 60,000-square-foot building at 330 Townsend St. and replace it with a 21-story tower that would consist of 383,000 square feet of retail and office with a two-story galleria. The developer bought the brick Townsend building in April of 2013 for an estimated $30 million. At the time, the property was 98 percent leased, but CIM was already looking at its redevelopment potential, stating that the property was zoned for much more space and sits across the street from the Caltrain Station and one block from the Central Subway transit line that is under construction.

The proposals come at a time when San Francisco already has a pipeline of 5.5 million square feet under construction and more than 14 million square feet of office at different phases of the approval pipeline, according to CBRE.
Of the current pipeline, not all of that will get built any time soon as development is subject to Prop. M, a city law that caps the amount of office that can be approved for construction each year. Currently, there is a little more than 2 million square feet available.
Developers are motivated by ballooning office rents in San Francisco, which have doubled in some buildings in the last few years, and the phenomenon of tenants leasing up huge blocks of space in new buildings years before they are completed. The biggest example is Salesforce.com leasing 714,000 square or about half of the 1.4 million-square-foot Transbay office tower. Other early tenants who recently took big leases include Trulia, Macys.com, DropBox, Twitter, Eventbrite and Neustar.

From The CoStar Industrial Report – First Quarter 2014 – San Francisco Industrial Market

source: www.costar.com

The San Francisco Industrial market ended the first quarter 2014 with a vacancy rate of 5.8%. The vacancy rate was down over the previous quarter, with net absorption totaling positive 108,263 square feet in the first quarter. Vacant sublease space increased in the quarter, ending the quarter at 240,425 square feet. Rental rates ended the first quarter at $14.46, an increase over the previous quarter. There were no properties under construction at the end of the quarter.

Absorption
Net absorption for the overall San Francisco Industrial market was positive 108,263 square feet in the first quarter 2014. That compares to positive 542,155 square feet in the fourth quarter 2013, positive 197,735 square feet in the third quarter 2013, and positive 538,685 square feet in the second quarter 2013.

The Flex building market recorded net absorption of positive 952 square feet in the first quarter 2014, compared to positive 119,671 square feet in the fourth quarter 2013, positive 285,841 in the third quarter 2013, and positive 121,298 in the second quarter 2013.
The Warehouse building market recorded net absorption of positive 107,311 square feet in the first quarter 2014 compared to positive 422,484 square feet in the fourth quarter 2013, negative (88,106) in the third quarter 2013, and positive 417,387 in the second quarter 2013.

Vacancy
The Industrial vacancy rate in the San Francisco market area decreased to 5.8% at the end of the first quarter 2014. The vacancy rate was 6.0% at the end of the fourth quarter 2013, 6.6% at the end of the third quarter 2013, and 6.9% at the end of the second quarter 2013.
Flex projects remained at a vacancy rate of 9.2% at the end of the first quarter 2014 compared to the previous quarter, and9.7% at the end of the third quarter 2013, and 11.1% at the end of the second quarter 2013.

Warehouse projects reported a vacancy rate of 4.7% at the end of the first quarter 2014, 5.0% at the end of fourth quarter 2013, 5.6% at the end of the third quarter 2013, and 5.5% at the end of the second quarter 2013.

Sublease Vacancy
The amount of vacant sublease space in the San Francisco market increased to 240,425 square feet by the end of the first quarter 2014, from 147,837 square feet at the end of the fourth quarter 2013. There was 222,073 square feet vacant at the end of the third quarter 2013 and 172,968 square feet at the end of the second quarter 2013

San Francisco’s Flex projects reported vacant sublease space of 135,533 square feet at the end of first quarter 2014, up from the 129,587 square feet reported at the end of the fourth quarter 2013. There were 136,326 square feet of sublease space vacant at the end of the third quarter 2013, and 142,503 square feet at the end of the second quarter 2013.

Warehouse projects reported increased vacant sublease space from the fourth quarter 2013 to the first quarter 2014. Sublease vacancy went from 18,250 square feet to 104,892 square feet during that time. There was 85,747 square feet at the end of the third quarter 2013, and 30,465 square feet at the end of the second quarter 2013.

Rental Rates
The average quoted asking rental rate for available Industrial space was $14.46 per square foot per year at the end of the first quarter 2014 in the San Francisco market area. This represented a 0.3% increase in quoted rental rates from the end of the fourth quarter 2013, when rents were reported at $14.42 per square foot.

The average quoted rate within the Flex sector was $23.01 per square foot at the end of the first quarter 2014, while Warehouse rates stood at $10.86. At the end of the fourth quarter 2013, Flex rates were $22.75 per square foot, and Warehouse rates were $10.87.

Deliveries and Construction
During the first quarter 2014, no new space was completed in the San Francisco market area. This compares to one building totaling 36,000 square feet that was completed in the fourth quarter 2013, nothing completed in the third quarter 2013, and 189,000 square feet in one building completed in the second quarter 2013.

There was no Industrial space under construction at the end of the first quarter 2014.

Inventory
Total Industrial inventory in the San Francisco market area amounted to 94,885,548 square feet in 4,857 buildings as of the end of the first quarter 2014. The Flex sector consisted of 23,355,194 square feet in 783 projects. The Warehouse sector consisted of 71,530,354 square feet in 4,074 buildings. Within the Industrial market there were 491 owner-occupied buildings accounting for 12,246,466 square feet of Industrial space.

Sales Activity
Tallying industrial building sales of 15,000 square feet or larger, San Francisco industrial sales figures rose during the fourth quarter 2013 in terms of dollar volume compared to the third quarter of 2013.

In the fourth quarter, 11 industrial transactions closed with a total volume of $76,215,000. The 11 buildings totaled 460,604 square feet and the average price per square foot equated to$165.47 per square foot. That compares to five transactions totaling $20,112,500 in the third quarter. The total square footage was 125,936 for an average price per square foot of $159.70.

Total year-to-date industrial building sales activity in 2013 is down compared to the previous year. In the twelve months of 2013, the market saw 30 industrial sales transactions with a total volume of $183,297,100. The price per square foot has averaged $166.30 this year. In the twelve months of 2012, the market posted 43 transactions with a total volume of $267,879,854. The price per square foot averaged $146.09.

7,500+/- of totally clear span warehouse with 28′-30′ ceilings is for lease at 2070 Newcomb Avenue. This property boasts substantial power, is fully sprinklered and includes a side yard with private parking.

Available August 1, 2014 at $1.25 psf., IG.

If you have any questions about this listing, other available properties or the San Francisco commercial real estate market, call Calco Commercial at 415.970.0000.

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Approximately 4,034+/- total square feet, Calco is leasing 238 Capp Street. This property consists of 3,220+/- square feet of ground floor warehouse space, 814+/- square feet of second floor office/creative space and is of concrete construction. The warehouse area has 15′ ceilings and one (1) drive-in loading door. Available June 1, 2014 at $7,950.00 per month. The second floor can be leased separately at $2,685.00 per month.

238 Capp Street is located in the heart of the vibrant Mission District and only one block from the 16th Street BART Station, numerous MUNI bus lines and a multitude of restaurants and shops.

If you have any questions about this listing or other available commercial real estate properties, call Calco at 415.970.0000.

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