Category: San Francisco Commercial Real Estate Listings] (43)

San Francisco’s Office Vacancy Decreases to 6.8%

The San Francisco Office market ended the first quarter 2016 with a vacancy rate of 6.8%. The vacancy rate was down over the previous quarter, with net absorption totaling positive 887,196 square feet in the first quarter. Vacant sublease space increased in the quarter, ending the quarter at 1,412,643 square feet. Rental rates ended the first quarter at $52.43, an increase over the previous quarter. A total of two buildings delivered to the market in the quarter totaling 480,000 square feet, with 5,352,288 square feet still under construction at the end of the quarter.

Absorption
Net absorption for the overall San Francisco office market was positive 887,196 square feet in the first quarter 2016. That compares to positive 680,988 square feet in the fourth quarter
2015, negative (297,950) square feet in the third quarter 2015, and positive 1,332,620 square feet in the second quarter 2015.

The Class-A office market recorded net absorption of positive 669,332 square feet in the first quarter 2016, compared to positive 689,681 square feet in the fourth quarter 2015, negative (25,939) in the third quarter 2015, and positive 825,531 in the second quarter 2015.

The Class-B office market recorded net absorption of positive 248,697 square feet in the first quarter 2016, com- pared to negative (39,232) square feet in the fourth quarter
2015, negative (216,768) in the third quarter 2015, and positive 555,278 in the second quarter 2015.

The Class-C office market recorded net absorption of negative (30,833) square feet in the first quarter 2016 com- pared to positive 30,539 square feet in the fourth quarter
2015, negative (55,243) in the third quarter 2015, and negative (48,189) in the second quarter 2015.

Net absorption for San Francisco’s central business district was positive 660,981 square feet in the first quarter 2016. That compares to positive 163,176 square feet in the fourth quarter
2015, negative (267,529) in the third quarter 2015, and positive 387,476 in the second quarter 2015.

Net absorption for the suburban markets was positive 226,215 square feet in the first quarter 2016. That compares to positive 517,812 square feet in fourth quarter 2015, negative (30,421) in the third quarter 2015, and positive 945,144 in the second quarter 2015.

Vacancy
The office vacancy rate in the San Francisco market area decreased to 6.8% at the end of the first quarter 2016. The vacancy rate was 7.0% at the end of the fourth quarter 2015,
6.6% at the end of the third quarter 2015, and 6.4% at the end of the second quarter 2015.

1stQTR Office Vacancy Graph

Class-A projects reported a vacancy rate of 7.7% at the end of the first quarter 2016, 8.0% at the end of the fourth quarter 2015, remained the same at 7.4% at the end of the third quarter 2015 compared to the previous quarter.

Class-B projects reported a vacancy rate of 6.7% at the end of the first quarter 2016, 7.1% at the end of the fourth quarter 2015, 6.7% at the end of the third quarter 2015, and
6.3% at the end of the second quarter 2015.

Class-C projects reported a vacancy rate of 3.8% at the end of the first quarter 2016, 3.7% at the end of fourth quarter 2015, 3.9% at the end of the third quarter 2015, and 3.6% at the end of the second quarter 2015.

The overall vacancy rate in San Francisco’s central business district at the end of the first quarter 2016 decreased to 6.3%. The vacancy rate was 7.0% at the end of the fourth quarter 2015, 6.0% at the end of the third quarter 2015, and 5.8% at the end of the second quarter 2015.

The vacancy rate in the suburban markets increased to 7.5% in the first quarter 2016. The vacancy rate was 7.1% at the end of the fourth quarter 2015, 7.5% at the end of the third quarter 2015, and 7.4% at the end of the second quarter 2015.

Sublease Vacancy
The amount of vacant sublease space in the San Francisco market increased to 1,412,643 square feet by the end of the first quarter 2016, from 1,352,132 square feet at the end of the fourth quarter 2015. There was 1,275,923 square feet vacant at the end of the third quarter 2015 and 1,102,001 square feet at the end of the second quarter 2015.

San Francisco’s Class-A projects reported vacant sublease space of 998,469 square feet at the end of first quarter 2016, up from the 967,996 square feet reported at the end of the fourth quarter 2015. There were 857,982 square feet of sub- lease space vacant at the end of the third quarter 2015, and 748,203 square feet at the end of the second quarter 2015.

Class-B projects reported vacant sublease space of 333,325 square feet at the end of the first quarter 2016, up from the 329,958 square feet reported at the end of the fourth quarter 2015. At the end of the third quarter 2015 there were 342,020 square feet, and at the end of the second quarter 2015 there were 298,324 square feet vacant.

Class-C projects reported increased vacant sublease space from the fourth quarter 2015 to the first quarter 2016. Sublease vacancy went from 54,178 square feet to 80,849 square feet during that time. There was 75,921 square feet at the end of the third quarter 2015, and 55,474 square feet at the end of the second quarter 2015.

Sublease vacancy in San Francisco’s central business district stood at 673,271 square feet at the end of the first quarter 2016. It was 595,812 square feet at the end of the fourth quar- ter 2015, 543,796 square feet at the end of the third quarter 2015, and 491,777 square feet at the end of the second quarter 2015.

Sublease vacancy in the suburban markets ended the first quarter 2016 at 739,372 square feet. At the end of the fourth quarter 2015 sublease vacancy was 756,320 square feet, was 732,127 square feet at the end of the third quarter 2015, and was 610,224 square feet at the end of the second quarter
2015.

Rental Rates
The average quoted asking rental rate for available office space, all classes, was $52.43 per square foot per year at the end of the first quarter 2016 in the San Francisco market area. This represented a 1.1% increase in quoted rental rates from the end of the fourth quarter 2015, when rents were reported at
$51.84 per square foot.

The average quoted rate within the Class-A sector was $54.11 at the end of the first quarter 2016, while Class-B rates stood at $51.77, and Class-C rates at $46.73. At the end of the fourth quarter 2015, Class-A rates were $53.77 per square foot, Class-B rates were $50.94, and Class-C rates were $45.57.

The average quoted asking rental rate in San Francisco’s CBD was $57.99 at the end of the first quarter 2016, and $50.36 in the suburban markets. In the fourth quarter 2015, quoted rates were $58.19 in the CBD and $49.47 in the suburbs.

Inventory
Total office inventory in the San Francisco market area amounted to 165,448,464 square feet in 3,843 buildings as of the end of the first quarter 2016. The Class-A office sector consisted of 77,319,980 square feet in 304 projects. There were 1,437 Class-B buildings totaling 64,146,043 square feet, and the Class-C sector consisted of 23,982,441 square feet in 2,102 buildings. Within the Office market there were 209 owner- occupied buildings accounting for 18,858,040 square feet of office space.

Sales Activity
Tallying office building sales of 15,000 square feet or larger, San Francisco office sales figures fell during the fourth quarter 2015 in terms of dollar volume compared to the third quarter of 2015.

In the fourth quarter, 14 office transactions closed with a total volume of $1,043,890,500. The 14 buildings totaled 1,634,104 square feet and the average price per square foot equated to $638.82 per square foot. That compares to 13 transactions totaling $1,955,263,000 in the third quarter 2015. The total square footage in the third quarter was 2,904,410 square feet for an average price per square foot of $673.20.

Total office building sales activity in 2015 was down com- pared to 2014. In the twelve months of 2015, the market saw 48 office sales transactions with a total volume of $4,814,873,500. The price per square foot averaged $651.62. In the same twelve months of 2014, the market posted 76 transactions with a total volume of $6,456,094,000. The price per square foot averaged
$544.50.

Cap rates have been lower in 2015, averaging 4.76% compared to the same period in 2014 when they averaged 4.88%. One of the largest transactions that occurred within the last four quarters in the San Francisco market is the sale of 333 Bush St in San Francisco. This 546,182-square-foot office building sold for $378,500,000, or $692.99 per square foot. The property sold on 12/24/2015, at a 3.70% cap rate.

source: CoStar 1st Quarter 2016 San Francisco Office Market Report

Highest Growth Levels since 2007

Source: CoStar
By: Mark Heschmeyer
Date Posted: March 23, 2016

For commercial property owners, 2015 was a very good year. According to early analysis of securitized loan results through February of 2016, the commercial properties backing the loans posted strong net operating income (NOI) growth, increasing 3.8% on average in 2015.

Average NOI for commercial property backing CMBS loans showed a big jump in 2015, compared with 2.66% in 2014 and 2.64% in 2013, according to analysis by Wells Fargo Securities.

BuildingOwner

The Wells Fargo analysis is based on NOIs reported for more than 6,000 loans in conduit CMBS transactions.

While Wells Fargo cautioned the results are preliminary, if the growth rate stays near the current level, it would mark the highest change since the financial crisis, surpassing the 3.4% annual NOI average increase in 2012.

Hotel, self-storage and multifamily properties backing CMBS loans were the lead profit-centers, driving average NOI increases of 8.6%, 8.5% and 7%, respectively.

Link to article: NOI Growth

San Francisco’s Vacancy Increases to 3.6%
Net Absorption Negative (517,362) SF in the Quarter

Source: CoStar

The San Francisco Industrial market ended the third quar- ter 2015 with a vacancy rate of 3.6%. The vacancy rate was up over the previous quarter, with net absorption totaling negative (517,362) square feet in the third quarter. Vacant sublease space decreased in the quarter, ending the quarter at 337,738 square feet. Rental rates ended the third quarter at $17.82, an increase over the previous quarter. There was 293,100 square feet still under construction at the end of the quarter.

ABSORPTION

Net absorption for the overall San Francisco Industrial market was negative (517,362) square feet in the third quar- ter 2015. That compares to positive 89,907 square feet in the second quarter 2015, positive 111,275 square feet in the first quarter 2015, and positive 255,214 square feet in the fourth quarter 2014.

Tenants moving out of large blocks of space in 2015 include: Nippon Express U.S.A. moving out of (188,000) square feet at 250 Utah Ave, Tyco Electronics moving out of (184,462) square feet at 300 Constitution Dr, and Hajoca Corporation moving out of (40,000) square feet at 1111 Connecticut St.

Tenants moving into large blocks of space in 2015 include: Green Leaf moving into 105,600 square feet at 455 Valley Dr, Invitae Corporation moving into 103,213 square feet at 1400 16th St, and Flying Food Group moving into 69,500 square feet at 240 Littlefield Ave.

The Flex building market recorded net absorption of posi- tive 26,642 square feet in the third quarter 2015, compared to positive 203,145 square feet in the second quarter 2015, positive 104,924 in the first quarter 2015, and positive 114,780 in the fourth quarter 2014.

The Warehouse building market recorded net absorption of negative (544,004) square feet in the third quarter 2015 compared to negative (113,238) square feet in the second quarter 2015, positive 6,351 in the first quarter 2015, and posi- tive 140,434 in the fourth quarter 2014.

VACANCY

The Industrial vacancy rate in the San Francisco market area increased to 3.6% at the end of the third quarter 2015. The vacancy rate was 3.2% at the end of the second quarter 2015, and remained at 3.7% at the end of the first quarter 2015 compared to the previous quarter.

Flex projects reported a vacancy rate of 3.9% at the end of the third quarter 2015, 4.0% at the end of the second quarter 2015, 5.0% at the end of the first quarter 2015, and 5.4% at the end of the fourth quarter 2014.

3RDqtrGRAPH

Warehouse projects reported a vacancy rate of 3.5% at the end of the third quarter 2015, 3.0% at the end of second quarter 2015, 3.3% at the end of the first quarter 2015, and 3.1% at the end of the fourth quarter 2014.

SUBLEASE VACANCY

The amount of vacant sublease space in the San Francisco market decreased to 337,738 square feet by the end of the third quarter 2015, from 339,249 square feet at the end of the second quarter 2015. There was 333,754 square feet vacant at the end of the first quarter 2015 and 285,144 square feet at the end of the fourth quarter 2014.

San Francisco’s Flex projects reported vacant sublease space of 159,239 square feet at the end of third quarter 2015, down from the 164,850 square feet reported at the end of the second quarter 2015. There were 186,108 square feet of sub- lease space vacant at the end of the first quarter 2015, and208,699 square feet at the end of the fourth quarter 2014.

Warehouse projects reported increased vacant sublease space from the second quarter 2015 to the third quarter 2015. Sublease vacancy went from 174,399 square feet to 178,499 square feet during that time. There was 147,646 square feet at the end of the first quarter 2015, and 76,445 square feet at the end of the fourth quarter 2014.

RENTAL RATES
The average quoted asking rental rate for available Industrial space was $17.82 per square foot per year at the end of the third quarter 2015 in the San Francisco market area. This represented a 1.7% increase in quoted rental rates from the end of the second quarter 2015, when rents were reported at $17.52 per square foot.

The average quoted rate within the Flex sector was $28.42 per square foot at the end of the third quarter 2015, while Warehouse rates stood at $13.76. At the end of the sec- ond quarter 2015, Flex rates were $28.53 per square foot, and Warehouse rates were $13.03.

DELIVERIES AND CONSTRUCTION

During the third quarter 2015, no new space was completed in the San Francisco market area. This compares to 0 buildings completed in the second quarter 2015, three buildings totaling 118,080 square feet completed in the first quarter 2015, and nothing completed in the fourth quarter 2014.

There were 293,100 square feet of Industrial space under construction at the end of the third quarter 2015.

Some of the notable 2015 deliveries include: 901 Rankin St, an 82,480-square-foot facility that delivered in first quarter 2015 and is now 100% occupied, and 1 Kelly Ct, a 25,600- square-foot building that delivered in first quarter 2015 and is now 100% occupied.

The largest projects underway at the end of third quarter 2015 were The Cove – Building 3, a 153,047-square-foot building with 0% of its space pre-leased, and The Cove – Building 4, a 140,053-square-foot facility that is 0% pre-leased.

INVENTORY

Total Industrial inventory in the San Francisco market area amounted to 94,065,666 square feet in 4,812 buildings as of the end of the third quarter 2015. The Flex sector consisted of 23,919,746 square feet in 791 projects. The Warehouse sector consisted of 70,145,920 square feet in 4,021 buildings. Within the Industrial market there were 520 owner-occupied buildings accounting for 12,959,398 square feet of Industrial space.

SALES ACTIVITY

Tallying industrial building sales of 15,000 square feet or larger, San Francisco industrial sales figures fell during the sec- ond quarter 2015 in terms of dollar volume compared to the first quarter of 2015.

In the second quarter, 11 industrial transactions closed with a total volume of $88,245,000. The 11 buildings totaled 423,420 square feet and the average price per square foot equated to $208.41 per square foot. That compares to 17 transactions totaling $180,790,000 in the first quarter. The total square footage was 870,221 for an average price per square foot of $207.75.

Total year-to-date industrial building sales activity in 2015 is down compared to the previous year. In the first six months of 2015, the market saw 28 industrial sales transac- tions with a total volume of $269,035,000. The price per square foot has averaged $207.97 this year. In the first six months of 2014, the market posted 30 transactions with a total volume of $275,279,100. The price per square foot averaged $211.04.

Cap rates have been lower in 2015, averaging 4.34%, compared to the first six months of last year when they aver- aged 6.58%.

Full Report: 3rdQTR_Industrial

Calco Commercial represented the Buyer in the recent purchase of 111 S. Maple Avenue in South San Francisco. 111 South Maple Avenue consists of 27,360+/- square feet of commercial warehouse construction situated on a larger 1.25 acre lot. The warehouse boasts high ceilings, heavy power and close proximity to Highway 101, I-280, I-380 and SFO.

111_S_Maple

Calco Commercial has completed nearly 60 lease and sale transactions over the last year, representing approximately 450,000 square feet of commercial product. Calco continues to lead the San Francisco brokerage industrial marketplace. The Bay Area commercial properties continue to demand premium rental and sale rates as inventory and vacancies shrink.

Calco Commercial is a full service outfit that can help you make the most of your real estate properties and investments. If you would like to discuss your real estate options, or would simply like more information related to current market conditions, please call our office at 415.970.0000.

San Francisco’s Vacancy Decreases for the 12th Consecutive Quarter to 3.1%
Source: CoStar

The San Francisco Industrial market ended the second quarter 2015 with a vacancy rate of 3.1%. The vacancy rate was down over the previous quarter, with net absorption totaling positive 307,426 square feet in the second quarter. Vacant sublease space decreased in the quarter, end- ing the quarter at 306,979 square feet. Rental rates ended the second quarter at $17.26, an increase over the previous quarter. There was 293,100 square feet still under construction at the end of the quarter.

San Francisco Industrial Real Estate

Absorption
Net absorption for the overall San Francisco Industrial market was positive 307,426 square feet in the second quarter
2015. That compares to positive 120,002 square feet in the first quarter 2015, positive 266,214 square feet in the fourth quarter
2014, and negative (22,710) square feet in the third quarter 2014.

The Flex building market recorded net absorption of posi- tive 178,179 square feet in the second quarter 2015, compared to positive 33,684 square feet in the first quarter 2015, positive 125,780 in the fourth quarter 2014, and positive 140,779 in the third quarter 2014.

The Warehouse building market recorded net absorp- tion of positive 129,247 square feet in the second quarter 2015 compared to positive 86,318 square feet in the first quarter 2015, positive 140,434 in the fourth quarter 2014, and negative (163,489) in the third quarter 2014.

Vacancy
The Industrial vacancy rate in the San Francisco market area decreased to 3.1% at the end of the second quarter 2015. The vacancy rate remained at 3.7% at the end of the first quarter 2015 compared to the previous quarter, and 4.0% at the end of the third quarter 2014.

Flex projects reported a vacancy rate of 4.4% at the end of the second quarter 2015, remained at 5.3% at the end of the first quarter 2015 compared to the previous quarter, and 5.8% at the end of the third quarter 2014.

Warehouse projects reported a vacancy rate of 2.7% at the end of the second quarter 2015, 3.2% at the end of first quarter 2015, 3.1% at the end of the fourth quarter 2014, and 3.3% at the end of the third quarter 2014.

Sublease Vacancy
The amount of vacant sublease space in the San Francisco market decreased to 306,979 square feet by the end of the second quarter 2015, from 333,754 square feet at the end of the first quarter 2015. There was 285,144 square feet vacant at the end of the fourth quarter 2014 and 290,380 square feet at the end of the third quarter 2014.

San Francisco’s Flex projects reported vacant sublease space of 164,850 square feet at the end of second quarter 2015, down from the 186,108 square feet reported at the end of the first quarter 2015. There were 208,699 square feet of sublease space vacant at the end of the fourth quarter 2014, and 91,366 square feet at the end of the third quarter 2014.

Warehouse projects reported decreased vacant sublease space from the first quarter 2015 to the second quarter 2015. Sublease vacancy went from 147,646 square feet to 142,129 square feet during that time. There was 76,445 square feet at the end of the fourth quarter 2014, and 199,014 square feet at the end of the third quarter 2014.

Rental Rates
The average quoted asking rental rate for available Industrial space was $17.26 per square foot per year at the end of the second quarter 2015 in the San Francisco market area. This represented a 5.4% increase in quoted rental rates from the end of the first quarter 2015, when rents were reported at $16.38 per square foot.

The average quoted rate within the Flex sector was $27.89 per square foot at the end of the second quarter 2015, while Warehouse rates stood at $13.03. At the end of the first quarter 2015, Flex rates were $26.53 per square foot, and Warehouse rates were $12.20.

Calco Commercial Real Estate has sold 360 Barneveld Avenue. 360 Barneveld Avenue consists of 3,775+/- square feet of clear span warehouse with 16′ ceilings and second floor offices. The property includes one (1) large drive-in door and is located in the Bayshore Corridor Area.

360 Barneveld_Exterior Photo_for Web

If you have any questions about the San Francisco & Peninsula commercial real estate markets or any of our available listings, call our office at 415.970.0000.

Calco Commercial Real Estate has recently leased the following warehouses and offices in the San Francisco marketplace:

540 Barnveld Avenue. This clearspan warehouse space has one (1) drive-in loading door and is 3,950+/- square feet of commercial space and is part of the Valhalla Real Estate Industrial Complex in San Francisco.

455 Barneveld. This 5,830+/- square foot clear span warehouse includes one (1) drive-in loading door and is located within the Valhalla Real Estate Industrial Complex in San Francisco.

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3130 20th Street #175. This 3,326+/- square foot Central Mission creative space included private and open areas, ground floor location and on-site parking availability.

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75 Industrial. This 22,000+/- square foot clearspan warehouse includes a real yard, two (2) drive-in loading doors, and a high identity corner location in the Bayshore Area of San Francisco.

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360 Bayshore Boulevard. This 5,720+/- square foot clearspan warehouse includes one (1) large roll-up door, a small office and a central Bayshore Corridor location. Zoned PDR-1G with the Bayshore Home Improvement Designation, 360 Bayshore Boulevard also allows for retail uses.

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2170 Cesar Chavez. This 12,500+/- square foot clearspan warehouse includes four (4) docks, one (1) drive-in loading door, a small office and a large exterior loading and parking area.

2170 Cesar Chavez_Web

If you have any questions about our available properties, or the San Francisco or Peninsula commercial real estate markets, call our office at 415.970.0000.

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Calco Commercial Real Estate, is pleased to present 385-A 8th Street, which will be available to lease March 1, 2015. The commercial office space includes 4,736+/- square feet of second floor funky/creative space, a full kitche, skylights, hardwood floors, rooftop deck and an open floor plan. Situated in the SOMA, this space would be great for a creative user. The space will lease for $2.50 psf. or $30.00 psf. annual.

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

385 8th Exterior_for web

Calco Commercial has represented the Landlord in the leasing of 2130 Oakdale Avenue to Hocckke Yeo, LLC. 2130 Oakdale Avenue consists of 12,800+/- square feet of clearspan warehouse with 25′ ceiling height, concrete construction, 400 amp 3 phase power, sprinklers, and one (1) large drive-in loading door. 2130 Oakdale is located in the Bayshore Corridor area of San Francisco, which is bounded by Highway 101, I-280 and Cesar Chavez. This industrial property has great access to both Downtown San Francisco and the Peninsula Areas.

Per CoStar, industrial product in the 10-15,000 square foot range in the Bayshore is quickly evaporating, with only two buildings actively available for lease in the same square footage. If you would like more information on the San Francisco commercial real estate market place, or our other available listings, please call 415.970.0000.

2130 Oakdale_Photo_for web

Calco Commercial real estate has facilitated a 7-year lease at 1950-2170 Cesar Chavez between the Landlord and the new Tenant, McMillan Electric. The leased property is a total of 40,500+/- square feet which includes dock load, office area & private fenced parking. The premises is part of the Gibraltar Business Center located on Cesar Chavez in between Highway 101 and I-280.

For more information on our other listings, or current San Francisco commercial real estate conditions, call 415.970.0000.

1950 Cesar Chavez

1950-2090 Aerial-Outline