Uncategorized | Calco Commercial, Inc.

Category: Uncategorized (21)

Jan

San Francisco Year-End 2015 Industrial Real Estate Summary

Source: CoStar Year-End 2015 Industrial Report

The San Francisco Industrial market ended the fourth quarter 2015 with a vacancy rate of 3.2%. The vacancy rate was down over the previous quarter, with net absorption totaling positive 383,017 square feet in the fourth quarter. Vacant sublease space decreased in the quarter, end- ing the quarter at 245,799 square feet. Rental rates ended the fourth quarter at $18.60, an increase over the previous quarter. There was 408,797 square feet still under construction at the end of the quarter.

Absorption

Net absorption for the overall San Francisco Industrial market was positive 383,017 square feet in the fourth quarter 2015. That compares to negative (537,118) square feet in the third quarter 2015, positive 51,907 square feet in the second quarter 2015, and negative (8,761) square feet in the first quarter 2015.

The Flex building market recorded net absorption of positive 124,445 square feet in the fourth quarter 2015, compared to positive 526 square feet in the third quarter 2015, positive 165,145 in the second quarter 2015, and positive 5,888 in the first quarter 2015.

The Warehouse building market recorded net absorption of positive 258,572 square feet in the fourth quarter 2015 com- pared to negative (537,644) square feet in the third quarter 2015, negative (113,238) in the second quarter 2015, and negative (14,649) in the first quarter 2015.

Vacancy

The Industrial vacancy rate in the San Francisco market area decreased to 3.2% at the end of the fourth quarter 2015. The vacancy rate was 3.6% at the end of the third quarter 2015, 3.3% at the end of the second quarter 2015, and 3.8% at the end of the first quarter 2015.

Flex projects reported a vacancy rate of 3.4% at the end of the fourth quarter 2015, 4.0% at the end of the third quarter 2015, 4.2% at the end of the second quarter 2015, and 5.4% at the end of the first quarter 2015.

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

Sublease Vacancy

The amount of vacant sublease space in the San Francisco market decreased to 245,799 square feet by the end of the fourth quarter 2015, from 337,620 square feet at the end of the third quarter 2015. There was 339,249 square feet vacant at the end of the second quarter 2015 and 333,754 square feet at the end of the first quarter 2015.

San Francisco’s Flex projects reported vacant sublease space of 54,864 square feet at the end of fourth quarter 2015, down from the 159,121 square feet reported at the end of the third quarter 2015. There were 164,850 square feet of sublease space vacant at the end of the second quarter 2015, and 186,108 square feet at the end of the first quarter 2015.

Warehouse projects reported increased vacant sublease space from the third quarter 2015 to the fourth quarter 2015. Sublease vacancy went from 178,499 square feet to 190,935 square feet during that time. There was 174,399 square feet at the end of the second quarter 2015, and 147,646 square feet at the end of the first quarter 2015.

Rental Rates

The average quoted asking rental rate for available Industrial space was $18.60 per square foot per year at the end of the fourth quarter 2015 in the San Francisco market area. This represented a 4.4% increase in quoted rental rates from the end of the third quarter 2015, when rents were reported at $17.82 per square foot.

The average quoted rate within the Flex sector was $30.14 per square foot at the end of the fourth quarter 2015, while Warehouse rates stood at $14.19. At the end of the third quarter 2015, Flex rates were $28.44 per square foot, and Warehouse rates were $13.71.

Deliveries and Construction

During the fourth quarter 2015, no new space was completed in the San Francisco market area. This compares to 0 buildings in the previous two quarters, and 118,080 square feet in three buildings completed in the first quarter 2015.

There were 408,797 square feet of Industrial space under construction at the end of the fourth 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 fourth quarter 2015 were The Cove Building 3, a 153,047-square-foot building with 50% of its space pre-leased, and The Cove Building 4, a 140,053-square-foot facility that is 0% pre-leased.

Sales Activity

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

In the third quarter, seven industrial transactions closed with a total volume of $51,564,100. The seven buildings totaled 289,631 square feet and the average price per square foot equated to $178.03 per square foot. That compares to 11 transactions totaling $88,245,000 in the second quarter. The total square footage was 423,420 for an average price per square foot of $208.41.

Total year-to-date industrial building sales activity in 2015 is down compared to the previous year. In the first nine months of 2015, the market saw 35 industrial sales transactions with a total volume of $320,599,100. The price per square foot has averaged $202.49 this year. In the first nine months of 2014, the market posted 40 transactions with a total volume of $365,813,100. The price per square foot averaged $214.70.

Cap rates have been lower in 2015, averaging 4.34%, compared to the first nine months of last year when they averaged 6.46%.

Link to full report: Q4 Costar

Feb

4,736+/- SF of Funky/Creative Commercial Office Space for Lease

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.

Dec

SF’s Prop M Puts Development Under the Gun

With demand for office space in San Francisco at its highest level in 15 years, anxious developers are waiting for the city to determine how it will approve projects under Proposition M’s construction constraints.

The San Francisco Planning Commission most likely won’t implement a selection process until midway through 2015 at the earliest, but in mid-November an industry discussion panel provided an update on the city’s Prop. M policy formation and state of the office market.
The event was closed to the media, but presentations and attendees indicate that city planners continue to debate whether to institute a “competitive pool” policy, in which a group of projects compete for approval, or to continue evaluations on a project-by-project basis.

“What you can gather is that there are a lot of options about how to do this right now—there are procedural questions, substantive questions about criteria and questions about implementation,” said David Blackwell, who moderated the panel and leads the land use practice group for the Allen Matkins law firm in San Francisco. “There are a lot of variables that haven’t crystallized yet.”

Approved in 1986, Prop. M caps the amount of large new office projects at 875,000 square feet annually. Unused allocations are rolled forward, and the current cap is at a little more than 3 million square feet. But about 3.2 million square feet in applications are pending, and nearly 8 million square feet are in the pre-application process, according to a presentation that John Rahaim, the planning director for San Francisco, gave at the event. That amounts to a pipeline deficit of about 8 million square feet.

Meanwhile, office rents have skyrocketed amid a demand for space that parallels the height of the dot-com boom in 2000, a trend that shows no signs of slowing down absent an economic downturn.

Average asking rents since 2010 have doubled to $61.69 per square foot, while the average vacancy rate has dropped 150 basis points to 6.7 percent over the last year, according to a presentation made at the event by Phil Tippett, an executive vice president of CBRE in San Francisco. Users have absorbed 4.3 million square feet in the last three years, and tenants looking for an aggregate of about 6 million square feet are in the market.

History suggests that the planning commission will institute a competitive pool. The commission used the process the last time developers butted against Prop. M in 2000 and 2001 and then reverted to the project-by-project review during years of lower demand.

But the commission still must decide what criteria to use in such a process. In 2000 and 2001, for example, competitive pool principles focused on public views, shadows, housing displacement and a handful of other elements. By comparison, in the late 1980s, broader standards concentrated on design, location and consistency with the city’s general plan.

A planning department staff memo in September suggested that a competitive pool for this round of development include criteria such as green building design, proximity to transit and the impact on production, distribution and repair space.

According to Rahaim’s presentation, if the commission decides to implement a competitive pool process, it also needs to determine how to score or weigh different elements, when to officially begin the competition, how long review periods should be, and whether to approve proposed projects that are ready to move forward before launching the policy.

Overall, office supply constraints have put existing landlords in enviable positions. During their most recent earnings calls, executives with large publicly traded office real estate investment trusts discussed Prop. M amid concerns that the current level of demand is unsustainable.

Officials with Boston Properties, Inc., for example, suggested that their 61-story Salesforce Tower in the South of Market neighborhood, which is expected to be completed in 2017, is further along than most projects and that the views from the top 30 floors generally available for lease provided a competitive advantage. (The firm is asking for more than $95 per square foot, according to CBRE.)

Additionally, Hudson Pacific Properties Inc. earlier this year finished leasing up the 1 million-square-foot 1455 Market St., a property it repositioned to appeal to technology tenants after buying it from Bank of America in 2010.

“From our standpoint [Prop. M] is a non-existent issue because we don’t have ground-up development—everything we have and everything we’ve looked at is on a renovation basis,” Hudson Pacific CEO Victor Coleman told analysts in response to a question about Prop. M’s influence. “If you’re a landlord in San Francisco and you like your portfolio, I don’t think it hurts you.”

Source: The Registry
Reporter: Jose Gose
Date: December 16, 2014

Article Link: PROP M

Nov

2170 Cesar Chavez – 12,500+/- SF Warehouse for Lease

12,500+/- square feet of superb and centrally located distribution space will be available for lease December 1, 2014 at 2170 Cesar Chavez. The space includes 4 docks, 1 drive-in loading door, a small office area and large exterior loading and parking. The lease rate is $1.25 PSF, IG. 2170 Cesar Chavez is located off the Bayshore Corridor and within close proximity to Highway 101 and I-280.

For more information on this property, our other commercial real estate listings, or the San Francisco marketplace, call 415.970.0000.

Oct

3130 20th Street – 13,850+/- of Creative/PDR Space for Lease

3130 20th Street is now available for lease. 3130 20th Street is centrally located in the Mission District just a few blocks from BART, countless shops and restaurants. The 13,850+/- square feet that is available can be divided into three spaces (9,000+/- main PDR space; 3,250+/- separate PDR space; and 1,600+/- SF of auxiliary warehouse). The spaces will be available on or about January 1, 2015 @ $2.25 psf./$27.00 annual.

For more information on this space, our other available listings or San Francisco real estate market conditions, call 415.970.0000.

3130 20th Street Property Brochure

Sep

160 Apartments & Ground Floor Commercial coming to the Mission

Source: San Francisco Business Times
Author: Cory Weinberg

The Mission has gotten plenty of buzz lately for packing hipness and high-priced rents into a once thoroughly working class neighborhood. Developer Lennar Multifamily Communities now wants to dive into the booming neighborhood, which is ground zero for fights over gentrification, with its first San Francisco apartment project.

If Lennar’s pitch goes as planned, popping up in the southern part of the Mission would be a 181,400-square-foot building that would house ground-floor commercial space and 160 apartments. The project would replace the McMillan Electric building at 1515 South Van Ness Ave., which was constructed 66 years ago. (It used to be an Oldsmobile dealership long ago.) The San Francisco Planning Department released details in a preliminary project assessment last week.

The six-story building would include a mix of studios, one-bedroom and two-bedroom apartments at an average size of 890 square feet, according to the assessment. The project would also need to tuck away 19 apartment units deemed “affordable” by the city.

“The Mission is one of the most powerful places to live in the city for all types – not just for people coming in and working at tech companies, but people who are born and raised here,” said Alex Waterbury, president of the company’s Northern California operation. “It’s a unique part of the city. There’s not a lot of supply currently in the southern end of the Mission.”
Indeed, most new Mission projects have skewed north. Lennar Multifamily is “in contract” to purchase the property and develop the space over the next several years after discussions with neighborhood residents and leaders, Waterbury said. He added that the he did not yet know how much it would cost to develop and build, stressing it is in the very early stages.

“We don’t see anyone waiting in the shadows to torpedo it, but there’s always concerns about design and responding well to the existing fabric to the neighborhood,” Waterbury said.
Still, opposition to market-rate housing projects in the Mission is not hard to find. A massive fight is already brewing over a much larger project, 351 units, at the 16th Street BART stop being proposed by Maximus Real Estate Partners. Another project by J.C.N. Developers also near the 16th Street BART station has spent nearly five years seeking entitlements amid fights with neighborhood groups.

This would be the first project in San Francisco for Lennar Multifamily, a division of the huge homebuilder Lennar Corp. Another division of the parent company, Lennar Urban, is selling units at The San Francisco Shipyard in Hunters Point and has thousands of units in the pipeline for Candlestick Point and Treasure Island. Lennar Multifamily is already has plans for 500 units in Berkeley, Redwood City and Mountain View.

Article Source: http://www.bizjournals.com/sanfrancisco/blog/real-estate/2014/09/lennar-building-housing-in-mission-district.html?ana=e_du_pub&s=article_du&ed=2014-09-23&u=19ELr7OrYiuRqEUxO8W3yQ0d406714&t=1411512748&page=all

Aug

Is Oakland the new SOMA?

Oakland looking more and more like the new SoMa for tech leasing

Source: San Francisco Business Journal
Author: Blanca Torres

As office rents soar and available space plummets in San Francisco and the Peninsula, now may be the right time for tech companies to pack up for Oakland.
Oakland is a prime position to attract tech tenants that could be priced out or simply can’t find space in the West Bay, said Bill Cumbelich, a broker with CBRE. Cumbelich mostly concentrated on San Francisco, but is now handling leasing for Oakland office buildings.
In the past, price was the primary reason to defect from San Francisco to the East Bay, but the scenario has changed. Oakland now boasts many of the urban amenities that draw tech tenants to San Francisco: proximity to BART and other public transportation, restaurants and nightlife. On top of that, housing is more affordable.
“We see this real estate cycle as a different scenario,” Cumbelich said. “It will be easier to attract and retain employees in Oakland. We think Oakland could be another submarket of San Francisco.”

Cumbelich isn’t the only person who sees Oakland as the SoMa of the future. Mitch Kapor, an early tech founder and philanthropist, moved his foundation and investment fund to Oakland two years ago and also made the Oakland-SoMa comparison. What made SoMa what it is now is that it started out as gritty and underutilized and was transformed into an edgy office market that attracted companies to break the norm.

Already, the migration trend of tenants going west to east is taking hold, said Trevor Thorpe, who manages CBRE’s East Bay operations. The wave started with non-profits, grew to professional services like law and engineering firms. Tech, he said, is next. The same pattern happened when SoMa went through revitalization as tenants were priced out of other parts of San Francisco. In the past three years, average asking rents in San Francisco shot up by 90 percent to $59 per square foot in 2013 from $31 per square foot in 2010. In Oakland, rents have climbed by 15 percent during the same period from $24 per square foot in 2010 to $28 per square foot in 2014 — half of the San Francisco average.

Besides rents soaring, San Francisco is the middle of a space crunch despite more than 4 million square feet of office space under construction since much of the new space is pre-leased. In a few years, development activity could hit a voter-approved cap on office development known as Prop. M that would stall prospective projects. Oakland’s has cheaper rents along with more available space will work in Oakland’s favor. The vacancy in San Francisco is 7 percent vs. 14.2 percent in Oakland.”We believe that the recent commercial real estate renaissance in the Oakland market is supporting a more broad-based and sticky (i.e. permanent) economic recovery and transference of users to the East Bay,” Thorpe said.

So far, the spillover effect from San Francisco to the East Bay counts more than 300,000 square feet of leasing. The East Bay has yet to land a marquis expansion or headquarters in this cycle, but that could happen once more creative space opens up in repositioned properties like the Sears department store that was recently bought by Lane Partners. Lane has plans to revamp the building as Uptown Station. Lane Partners is planning an extensive renovation of the 400,000-square-foot property that should be done by 2016. The work hasn’t even started and already a tech tenant with a requirement for 150,000 square feet has toured the building, Cumbelich said. “The building is being designed for tech,” he said. “We can land a big tenant in the next 12 months.”

http://www.bizjournals.com/sanfrancisco/blog/real-estate/2014/08/oakland-new-soma-office-leasing-tech-tenants.html?ana=e_du_pub&s=article_du&ed=2014-08-05&u=19ELr7OrYiuRqEUxO8W3yQ0d406714&t=1407279084&page=all

Jul

Calco Represents Tenant in 22,160+/- Lease – 480 Valley Drive, Brisbane

Calco represented Gander & White in the leasing of 480 Valley Drive in Brisbane. Located within the Crocker Industrial Park, 380 Valley Drive consists of 22,160+/- square feet of warehouse and improved office space, and a 11,800+/- square foot fenced and paved yard. The property also includes two (2) dock-high doors, two (2) drive-in loading doors, sprinklers, clear height of 22′-24′, heavy power and a front parking lot for 20 vehicles.

Calco Commercial, Inc. is a solution based San Francisco and Peninsula area commercial real estate brokerage firm. Specializing in Landlord and Tenant representation, plus the sales and leasing of industrial, office and flex use properties, Calco Commercial offers definitive results with personalized service. Steeped in knowledge about the Bay Area marketplace, Calco brings its clients over two decades of real estate experience coupled with unmatched customer service and prevailing technology. Calco has access to all of the major sources of market information, and the most current and high resolution property aerials and maps available. Utilizing these resources, Calco provides the tools to help their clients make the right decisions in the ever-changing real estate marketplace.

If you have any questions about our available listings or market conditions, please call 415.970.0000.

Jun

3130 20th Street – LEASED

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.

Feb

4,263+/- to 11,840+/- SF clearspan warehouse for lease at 2200 Jerrold Avenue

Two new units will be coming available for lease at 2200 Jerrold Avenue on July 1, 2014. Unit A is 5,120+/- square feet and Unit K is 6,720+/- square feet and can be leased separately, or together for a total of 11,840+/- square feet. Both units are clearspan, tilt-up construction with 22′ ceilings, spinklers and drive-in loading doors. $1.20 psf., NNN.

Unit Z which consists of 4,263+/- square feet is available now for $1.10 psf., NNN.

To view the full brochure and our other listings, click here: Calco Commercial Real Estate Listings