Source: BloombergPosted on 01/24/2021 7:27:31 PM PST by SeekAndFind
According to Bloomberg, real-estate data analytics firm Green Street released a new report outlining how the office space market in San Francisco will be the worst-preforming market in the US for 2021. Even though office vacancies in Manhattan are at record highs, it appears San Francisco tops New York City as companies reevaluating their space thanks to the pandemic.
Green Street estimates that rent and occupancy may plunge 22% in San Francisco this year, the largest expected decline of any other city in the country. New York was number two with -17%, Los Angeles in third at -9%. Source: Bloomberg
All of the cities shown above experienced similar pandemic-related stress of people escaping to suburbs and rural communities because of the virus and social unrest, along with the integration of remote-working, which allowed many people in white-collar jobs to work anywhere they pleased.
"San Francisco and New York will likely see a permanent resetting of rents as people and businesses look more toward the middle of the country for expansion," said Danny Ismail, an analyst at Green Street.
"It's unlikely that rents and occupancy will return to a level pre-Covid over the next few years," Ismail warned.
Green Street points out remote-working has forced many companies in major tech and finance hubs to reevaluate how much office space is needed.
Companies that are exiting these hubs are moving to cheaper metro areas, where the cost of living and tax code are more friendly. Some of those cities benefiting from the migration of companies and people are Nashville, Tennessee; Charlotte, North Carolina; Austin, Texas; and Atlanta.
Green Street makes a bold prediction that demand for office space will decline by 15% through the mid-point of the decade as businesses will be more inclined to adopt work-at-home lifestyles for their employees to trim costs and boost productivity.
In a separate report, Goldman Sachs Chief Economist Jan Hatzius said last month to clients that work-from-home will be widely adopted by firms and boost productivity.
You know, this makes it a lot easier to move a business out
of California. The employees can still work from San
Francisco, but the business can operate from a much more
friendly tax environment elsewhere.
Employees that do move with the company, can live in a much
more family and wallet friendly environment also.
Bye California...
I’d hate to own high rise office space right now and desire
to rent it out. As if...
Invite the Chinese to do business in San Francisco. Call Xi Jinping and see if he can open new offices for CCP.
Long-term investment possibilities. Should be back in 1600 years.
The office workers just loved wading thru sh*t and needles to get to work, right?
A small office will be cheaper than an apartment.
When a 3 story building’s rent gets to the point that I can rent it for my lemonade stand, I’ll think about it.
Please replace Istanbul with Constantinople.
If we are going to keep working from home, I’m gonna need an office to put my refrigerator in.
Why? Did Constantinople get the works?
Unfortunately, all of those who left San Francisco, New York, LA, New Jersey, (Chicago is not mentioned in this - did everybody already leave?), Portland, and Boston are still voting democrat-social-communist.
Great, they’ll have plenty of space for the homeless.
Yeah, that's what it's all about, the pandemic. It has nothing to do with the filth, the bums, the lack of safety, the drugs, the defecating in the streets, the lack of law enforcement, the political situation. It's all about the pandemic.
More living space for the homeless.
I suspect that SF will use the unused office space to house the homeless. The homeless seems to be the only growing demographic in the Bay Area.
Chinese control of liberal politicians, homeless and drug addicts pooping on streets, every liberal idea failing... yeah, it’s covid...
Our company provides Office Coffee Service and the cancelations just keep coming from San Francisco.
Salesforce Tower and TransAmerica building have been hollowed out
Where thousand once worked each has less than 100 people in the building now
It is nationwide.
Not everyone is leaving California, Marin County, Sonoma County, Napa and Solano property values are rising all most on a daily rate.
Sacramento housing up nearly 17% from the previous year’s fourth quarter. That is the fastest year-over-year price growth since 2013.Jan 4, 2021
The new home owners are often Californians from the Gay Frisco, E. Bay and SillyCon valley areas.
Some are leaving California and many are relocating to other California cities.
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