Office Update, Nationally and Locally

On a national level, the Colliers Q2  2022 U.S. Research Report reported that net absorption was positive for the third time in the past four quarters. Asking rents are holding firm but ‘generous concessions are on offer’. Sublease space is at record levels, now totaling 218 million square feet. Locally there is good news and some not-so good news. In  the Tri-Valley East Bay office region almost 400,000 square feet of office deals were just signed, including Vagaro subleasing 106,000 sf at 4430 Rosewood and Unchained Labs expanding from 60,000 sf to 121,000 sf at 4747 Willow Road, both deals in Pleasanton. Next door in Dublin Snowflake Software expanded from 40,000 sf to 153,000 sf at 4140 Dublin Blvd. On the other side of the equation, ADP just announced it was shutting down its 63,000 sf office at Britannia Business Center in Pleasanton. In San Francisco, according to the latest CBRE report, 29% of the city’s office space, 25 million square feet, is now available. In the Business Times article 8-10-22, “One industry executive wryly observed: ‘We’re not overbuilt, we’re under-demanded.” San Francisco’s occupancy rate, which is how many workers are actually back in the office, is at 39%, compared to 50-60% back East. “,,,the country’s biggest banks have all but ceased lending on high-rises.”