San Francisco Office Values Collapse 75%

NewsMax ^ | 05/19/2023 | Jeffrey Rodack

[SeekAndFind]

Office values in San Francisco have plunged 75% on a per-square foot basis compared to sales from just before the pandemic, the Hoover Institution said.

The Hoover report was authored by Lee Ohanian a senior fellow at the institution.

The report's finding noted the former Union Bank building, located in the center of San Francisco financial district, was auctioned off last week for $65 million — 75% less on a per-square-foot basis than comparable building sales just prior to the pandemic.

Ohanian called it "devastating news" for the city since the auction price provides a new market rate benchmark for setting the price for other downtown commercial buildings.

The report noted San Francisco's downtown vacancy rate has jumped from about 4% in 2019 to almost 30% now, as companies abandon the city for friendly taxe locales.

"The continuing losses of San Francisco's economic base are a symptom of a city that has become politically dysfunctional and is perceived by people and businesses to be dangerous and unworkable," the report said.

"And these losses will continue until those who govern San Francisco make different choices regarding the related issues of drug abuse, homelessness, and crime."

According to the report, retailers in the downtown area have been closing their stores — citing problems of theft and employee and customer safety.

The San Francisco Standard noted last week that thieves have been hitting one Target store at least 10 times a day. The store is located in a mall near San Francisco's Union Square.

[Elsie]

Anything Goes - Cole Porter

[Qiviut]

“The continuing losses of San Francisco’s economic base are a symptom of a city that has become politically dysfunctional and is perceived by people and businesses to be dangerous and unworkable,” the report said.

************************

California Fleein’ (Beach Boys Parody)
https://www.youtube.com/watch?v=TwJlKw56l30&t=6s

Starts out:

“All the streets are brown .... “

[Liberty Ship]

Not just San Francisco, but office vacancies are through the roof nationwide. Some buildings are totally vacant. People are working from home and aren’t inclined to come back.

Commercial leases are 3-5 years, so given the fact this started with Covid, how many businesses are going to simply renew their leases on space that has become vacant.

This could turn into a banking crisis.

OR, Biden could print money and convert it all to high rise condos for all the illegals he has imported!!!!

[Mouton]

San Francisco of the past is NOT coming back. The area will continue to be attractive but the economic base has been destroyed. It will continue along being like a zoo, complete with creatures.

They pushed out the military, too aggressive for them. Then the shipping industry, some over to Oakland. Fishing gone. It became a tourist town which works as long as the host does not crap, literally, on their feet. It, along with the local area, was a political powerhouse, perhaps that is why the last two hags are hanging on, Pelousy and Finestein.

The California Gold Rush grew the City. WWII was also a boon. The City perhaps reached its zenith circa 1980. After that, the queers took over and rationality took a back seat. I worked there from 73 through 90 in a position to see it happen. Sad.

[Jolla]

I was in a Financial District office 44 Montgomery right on Market Street. They made a big deal out of being owned by Indiana State Teachers Pension Fund or some such group. 75% drop, that is amazing, and it will not come back. Turn it into condos, I would buy a $100,000 bay view condo if they have them with $200 HOA fees.

[cgbg]

Meanwhile the banks who hold the commercial mortgages have marked these assets on their books to market....

Bwahahahahahaha.

Zero chance.

[cgbg]

San Francisco will be Detroit with earthquakes.

Every hundred years or so the city will turn to rubble.

[butlerweave]

Give San Francisco to the blacks that want reparations

[Dilbert San Diego]

I’ve heard that a lot of abandoned office buildings could be turned into condos.

But then some say the retrofitting of plumbing and electrical to turn offices into condos is too costly, and not too many buildings will be converted. So we’ll see.

[moviefan8]

I would think it would be too costly to convert into condos unless people are open to communal bathrooms. All you need to do then is put up walls.

[drwoof]

Meanwhile, the American Planning Association chooses to hyperventilate over Diversity, Equity, and Inclusion. Nary a peep about the hollowing-out of our economy and our downtown areas turning into ghost towns...

[Mr. Jeeves]

They made a big deal out of being owned by Indiana State Teachers Pension Fund or some such group.

As are many commercial properties - which will lead to the specter of loyal Old Democrats losing their retirements due to the antics of radical New Democrats. Trump was already making headway in widening this rift - I don’t see any other Republican politician even daring to mention it.

[T.B. Yoits]

I’ve heard that a lot of abandoned office buildings could be turned into condos. But then some say the retrofitting of plumbing and electrical to turn offices into condos is too costly, and not too many buildings will be converted.

Office buildings are not designed to handle the electrical load of households: Washers, dryers, dishwashers, refrigerators, stoves, and microwaves draw far more electricity than a typical office.

Plumbing is another issue. Baths, showers, laundry, and toilet use in a home also far exceeds the water use in an office.

Most office workers use the elevators once a day, or twice if they leave for lunch or meetings, and you can pack travelers in to handbag or briefcase distance. Condo owners, especially with children and/or pets would use the elevators far more frequently and often take larger personal items with them.

[lurk]

Last week Jorge was paddling across the Rio Grande in a leaky flatboat, and now here he is living in a corner office 35 floors above the Golden Gate Bridge.

[himno hero]

Or jails for the democrats who brought this on.

This 75% is nothing other than the first step.
Wait to see what happens once the residential market pops.

[Elsie]

... unless people are open to communal bathrooms.

Well; the STREETS are 'communal'; right?

[Elsie]

I guess we just can’t PACK the people into these buildings.

How many families (4-5 people) would fit (2,000 sq ft house) on one floor of a office building?

I think there would be FAR lass people per floor than now.

How big is a cubicle and 1 person is in it.

[Jane Long]

More room to house illegals, right Gruesome Newsom?

[political1]

We always hear about inflation, but what happens to society when it is hit with out of control deflation?

[jimfree]

This would happen eventually, but the Left and the Medical-Industrial-Complex brought it on early with a foolish power grab.