4th Quarter 2019 Industrial Market Summary
-San Francisco & Peninsula
The reported industrial vacancy rates in San Francisco and surrounding Peninsula areas increased to 4.1% at the end of Q4 2019 (up from 3.5% in Q3 2019). The Bayshore Corridor of San Francisco vacancy rate increased to 3.3% in Q4 (up from .9% in Q3 2019). The San Francisco/Peninsula market reported a delivery of 34,200+/- square feet of new construction, and 2,772,511 square feet of product under construction, primarily in South San Francisco, Brisbane & Daly City. The industrial core of San Francisco (Bayshore / Potrero Hill / Dogpatch) reported 238,000+/- square feet of product under construction, with zero deliveries, or construction starts.
Q4 2019 ended with averaged over-all asking rents (industrial and flex) remaining at $2.26 per square foot, representing no change over the previous quarter. Comparatively, current average US industrial asking rents are reported as $.72 per square foot (no change from Q3 2019). Asking rents specific to warehouse product dipped slightly to $1.83 psf at the end of Q4 (down from $1.88 Q3). Quoted daily warehouse asking rents for the Bayshore Corridor at the end of Q4 increased to $2.10 psf from $2.04 psf at the end of Q3. Year-over-year market rents have increased by 2.7% for the San Francisco/Peninsula industrial/flex market.
Q4 2019 Industrial sale transactions are down from Q3 2019 with $174M in sales volume averaging $362 per square foot compared to $440M in sales averaging $360 per square foot in Q3 2019. CAP rates averaged 4.7% in Q4, representing no change over the previous quarter. National CAP rates have remained at 6.7% for Q1-Q4 2019.
Calco Commercial has leased and sold 1,505,690+/- square feet of industrial, flex, office and land in 2019 comprising 83 transactions, with 407,846+/- square feet and 24 transactions in Q4 alone. Following are the notable Q4 2019 transactions: 1000 25th Street, San Francisco (18,432 +/- sf industrial lease), 195 Bayshore Boulevard, San Francisco (21,000+/- sf industrial lease), and 415 E. Grand, South San Francisco (21,000/- sf industrial lease), and 464 9th Street, San Francisco (16,080+/- commercial/sale). Calco Commercial is a leading industrial & commercial real estate firm with decades of experience in Landlord /Owner representation, and repositioning assets into net leased properties with in-place income streams. Let us help 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 a 415.970.0000, or directly contact one of our professionals.
CLICK HERE FOR THE FULL REPORT: Q4 Industrial Market Report