San Francisco and National Office Update

San Francisco’s office vacancy rate went from4% in early 2020 to 24% in April 2022, with leasing coming almost to a standstill combines with a number of companies giving back space. Not surprisingly, this has placed millions of feet of planned office projects on hold. Right now there are about 17 million feet of planned or approved office projects in the pipeline just waiting for demand to increase, and the existing supply to diminish. On the national basis office vacancy ticked upward during the first quarter of 2022, sublease space levels went up slightly, with the positive news that office occupancy levels went up as companies slowly returned to the office. According to a recent Colliers report, “Asking rents are holding firm, but generous concessions are on offer.” The overall national office vacancy is at 15%. The entire report can be downloaded at https://www.colliers.com/en/research/colliers-us-office-outlook-q1-2022