{"id":1004723698,"date":"2024-08-13T02:48:45","date_gmt":"2024-08-13T10:48:45","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004723698"},"modified":"2024-08-20T06:28:11","modified_gmt":"2024-08-20T14:28:11","slug":"strong-development-activity-in-pricey-san-francisco","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/","title":{"rendered":"Strong Development Activity in Pricey San Francisco"},"content":{"rendered":"\n

Although 2024 started off slowly, developers are continuing to add significant office projects to San Francisco\u2019s pipeline, turning it into one of the nation’s largest, CommercialEdge data shows. <\/p>\n\n\n

\n
\"Rendering<\/a>
Rendering of Kilroy Oyster Point, that will total 3 million square feet. Image courtesy of Kilroy Realty<\/em><\/figcaption><\/figure><\/div>\n\n\n

The slowdown in investment activity has dented office prices, but the metro remained one of the priciest in the U.S., with multiple life science properties changing hands.<\/p>\n\n\n\n

As of June, there were 5.6 million square feet of office space under construction across 25 office properties in San Francisco, representing 3 percent of total stock. <\/p>\n\n\n\n

The figure is well above the national average of 1.4 percent and also outpacing other similar markets, such as Manhattan (1.4 percent), Los Angeles (1.1 percent) and Chicago (0.5 percent), while Boston led the fold, at 4.5 percent.<\/p>\n\n\n\n

Office development activity outpaces other gateways<\/h2>\n\n\n\n

The global tech hub’s under-construction pipeline outperformed those of Los Angeles (3.5 million square feet) and Washington, D.C. (3.1 million square feet). In terms of square feet underway, San Francisco had middling performance among gateway markets, with Boston leading the ranking with a 12.9 million square feet pipeline, while Manhattan followed with 6.6 million square feet.<\/p>\n\n\n\n

Year-to-date through June, San Francisco saw 1.7 million square feet of office space delivered, accounting for 0.9 percent of total stock. Among the significant properties that came online since the start of the year was Boston Properties\u2019 651 Gateway Blvd., a 327,000-square-foot life science building that was completed in March. The 16-story South San Francisco property was originally built in 1986 and fully redeveloped.<\/p>\n\n\n

\n
\"535<\/a>
Clint Reilly Cos. sold the office property at 535 Pacific Ave. for approximately $60 million. Image courtesy of CommercialEdge<\/em><\/figcaption><\/figure><\/div>\n\n\n

The notable office properties currently underway include Kilroy Oyster Point\u2019s Buildings D, E and F<\/a>, three life science buildings that will total 865,000 square feet. The developments are part of Kilroy Realty\u2019s larger 3 million-square-foot waterfront project and are expected to come online in late 2025.<\/p>\n\n\n\n

Lane Partners\u2019 Southline Building 1 is also under construction. The 375,000-square-foot life science project broke ground in 2023 and is part of Southline project\u2019s first phase. The developer secured a $373 million construction loan for the development that can accommodate up to 2.8 million square feet of office and R&D space.<\/p>\n\n\n\n

San Francisco office prices still stay high despite investment slowdown<\/h2>\n\n\n\n

Year-to-date through June, San Francisco saw the continuation of the limited sales activity witnessed last year. The metro recorded $176.6 million in investment, with 12 office properties changing hands for an average sale price per square foot of $319. <\/p>\n\n\n\n

Among peer markets, Washington, D.C. led with $1.5 billion in office investments. The life science property type continues to garner attention and, along with medical office building investment<\/a>, is a key factor in the success of other gateway markets, most notably Boston.<\/p>\n\n\n

\n
\"300<\/a>
The 174,072-square-foot office building at 300 Millbrae Ave. traded in January. Image courtesy of CommercialEdge<\/em><\/figcaption><\/figure><\/div>\n\n\n

So far in 2024, in terms of average sale price per square foot, Manhattan remained the priciest office market, with properties changing hands for $552. Los Angeles followed (at $354 per square foot), while Washington, D.C., trailed with $271 per square foot.<\/p>\n\n\n\n

A significant deal was the $47.7 million acquisition of Gateway at Millbrae Station, a 174,072-square-foot office building that came online last January. Coming in at $274 per square foot, the deal for the Class A, six-story property was completed between buyer Swift Real Estate Partners and Republic Family of Cos.<\/p>\n\n\n\n

High vacancy rates, deals still coming through<\/h2>\n\n\n\n

The office vacancy rate in San Francisco reached 25.4 percent as of June. Since the start of the year, the percentage showed a continuous increase\u2014from the 23.7 percent recorded in January to the 25.2 percent recorded in May. In line with this ongoing trend in the metro, Google announced in May that the company is giving up 300,000 square feet<\/a> of office space at One Market Plaza.<\/p>\n\n\n

\n
\"279<\/a>
The 211,405-square-foot life science building at 279 E. Grand Ave. is situated within the Alexandria Center for Advanced Technologies mega campus. Image courtesy of CommercialEdge<\/em><\/figcaption><\/figure><\/div>\n\n\n

Notable office leases that closed in the first six months of the year include Alexandria Real Estate Equities Inc.\u2019s early lease renewal and extension<\/a> at its Alexandria Center for Advanced Technologies \u2013 South San Francisco campus, that consists of 211,405 square feet. The tenant is insistro, which will occupy 143,188 rentable square feet of space through 2034.<\/p>\n\n\n\n

In March, Silicon Valley Bank opened<\/a> its new downtown San Francisco office at Tishman Speyer\u2019s 222 Second St., a 452,418-square-foot office tower. The tenant will occupy multiple floors at the 26-story building, with its footprint totaling 60,000 square feet, according to CommercialEdge.<\/p>\n\n\n\n

Coworking sector still steady<\/h2>\n\n\n\n

The coworking sector in San Francisco is keeping steady so far, with 1.9 million square feet of shared office space in the metro as of June. Manhattan led the all gateway markets with 8.4 million square feet and was followed by Los Angeles (4.3 million square feet), Washington, D.C. (3.1 million square feet) and Chicago (2.9 million square feet).<\/p>\n\n\n\n

The metro\u2019s coworking space as percentage of total leasable office space reached 1.9 percent in June, above the national average of 1.8 percent and Washington, D.C.\u2019s rate (1.6 percent).<\/p>\n\n\n\n

The coworking operator that had the largest footprint in the metro was still WeWork, with locations totaling 772,964 square feet. The providers that followed were Regus, with 317,691 square feet, Studio by Tishman Speyer, with 158,632 square feet, Spaces, with 154,847 square feet and ReadySpaces, with 150,225 square feet.<\/p>\n","protected":false},"excerpt":{"rendered":"

The global tech hub’s office pipeline is among the largest in the nation, according to CommercialEdge information.<\/p>\n","protected":false},"author":2991,"featured_media":1004723711,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21782,37753,22251,21783,52420,21747,1609,15],"tags":[51047,50674],"class_list":["post-1004723698","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-development","category-research-center-finance","category-in-focus","category-investment","category-market-updates","category-office","category-san-francisco","category-west","tag-marketupdate","tag-commercialedge"],"acf":[],"yoast_head":"\nStrong Development Activity in Pricey San Francisco - Commercial Property Executive<\/title>\n<meta name=\"description\" content=\"San Francisco's office prices and pipeline still match those of gateway markets despite ongoing challenges, CommercialEdge data shows.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Strong Development Activity in Pricey San Francisco\" \/>\n<meta property=\"og:description\" content=\"San Francisco's office prices and pipeline still match those of gateway markets despite ongoing challenges, CommercialEdge data shows.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2024-08-13T10:48:45+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-08-20T14:28:11+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1000\" \/>\n\t<meta property=\"og:image:height\" content=\"750\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Simona Tudose\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/\",\"name\":\"Strong Development Activity in Pricey San Francisco - Commercial Property Executive\",\"isPartOf\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg\",\"datePublished\":\"2024-08-13T10:48:45+00:00\",\"dateModified\":\"2024-08-20T14:28:11+00:00\",\"author\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/4659e2337f06b61cefc6b0b897d183a4\"},\"description\":\"San Francisco's office prices and pipeline still match those of gateway markets despite ongoing challenges, CommercialEdge data shows.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#primaryimage\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg\",\"contentUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg\",\"width\":1000,\"height\":750,\"caption\":\"300 Millbrae Ave. Image courtesy of CommercialEdge\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.commercialsearch.com\/news\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Strong Development Activity in Pricey San Francisco\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#website\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/\",\"name\":\"Commercial Property Executive\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.commercialsearch.com\/news\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/4659e2337f06b61cefc6b0b897d183a4\",\"name\":\"Simona Tudose\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2023\/02\/SimonaTudose_AuthorPhoto.jpg?w=79\",\"contentUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2023\/02\/SimonaTudose_AuthorPhoto.jpg?w=79\",\"caption\":\"Simona Tudose\"},\"description\":\"Simona Tudose is an Associate Editor with Commercial Property Executive and Multi-Housing News. She joined the CPE-MHN team in July 2022 and writes news about industrial, office and manufactured housing sectors. You can reach out to her at simona.tudose@cpe-mhn.com.\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/author\/simona-tudose\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Strong Development Activity in Pricey San Francisco - Commercial Property Executive","description":"San Francisco's office prices and pipeline still match those of gateway markets despite ongoing challenges, CommercialEdge data shows.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/","og_locale":"en_US","og_type":"article","og_title":"Strong Development Activity in Pricey San Francisco","og_description":"San Francisco's office prices and pipeline still match those of gateway markets despite ongoing challenges, CommercialEdge data shows.","og_url":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/","og_site_name":"Commercial Property Executive","article_publisher":"https:\/\/www.facebook.com\/CPExecutive","article_published_time":"2024-08-13T10:48:45+00:00","article_modified_time":"2024-08-20T14:28:11+00:00","og_image":[{"width":1000,"height":750,"url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg","type":"image\/jpeg"}],"author":"Simona Tudose","twitter_card":"summary_large_image","twitter_creator":"@cpexecutive","twitter_site":"@cpexecutive","schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/","url":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/","name":"Strong Development Activity in Pricey San Francisco - Commercial Property Executive","isPartOf":{"@id":"https:\/\/www.commercialsearch.com\/news\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#primaryimage"},"image":{"@id":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#primaryimage"},"thumbnailUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg","datePublished":"2024-08-13T10:48:45+00:00","dateModified":"2024-08-20T14:28:11+00:00","author":{"@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/4659e2337f06b61cefc6b0b897d183a4"},"description":"San Francisco's office prices and pipeline still match those of gateway markets despite ongoing challenges, CommercialEdge data shows.","breadcrumb":{"@id":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#primaryimage","url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg","contentUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg","width":1000,"height":750,"caption":"300 Millbrae Ave. Image courtesy of CommercialEdge"},{"@type":"BreadcrumbList","@id":"https:\/\/www.commercialsearch.com\/news\/strong-development-activity-in-pricey-san-francisco\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.commercialsearch.com\/news\/"},{"@type":"ListItem","position":2,"name":"Strong Development Activity in Pricey San Francisco"}]},{"@type":"WebSite","@id":"https:\/\/www.commercialsearch.com\/news\/#website","url":"https:\/\/www.commercialsearch.com\/news\/","name":"Commercial Property Executive","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.commercialsearch.com\/news\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/4659e2337f06b61cefc6b0b897d183a4","name":"Simona Tudose","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/image\/","url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2023\/02\/SimonaTudose_AuthorPhoto.jpg?w=79","contentUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2023\/02\/SimonaTudose_AuthorPhoto.jpg?w=79","caption":"Simona Tudose"},"description":"Simona Tudose is an Associate Editor with Commercial Property Executive and Multi-Housing News. She joined the CPE-MHN team in July 2022 and writes news about industrial, office and manufactured housing sectors. You can reach out to her at simona.tudose@cpe-mhn.com.","url":"https:\/\/www.commercialsearch.com\/news\/author\/simona-tudose\/"}]}},"jetpack_featured_media_url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/08\/300-Millbrae-e1722517233610.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004723698","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/users\/2991"}],"replies":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/comments?post=1004723698"}],"version-history":[{"count":10,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004723698\/revisions"}],"predecessor-version":[{"id":1004725900,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004723698\/revisions\/1004725900"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media\/1004723711"}],"wp:attachment":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media?parent=1004723698"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/categories?post=1004723698"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/tags?post=1004723698"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}