San Francisco’s Office Building Market Heading In Two Directions

The SF Business Times 12/8/23 summarized the numerous bargain office building sales over the past few months. Presidio Bay Ventures bought 160 Spear St for $260/sf, SKS Partners and Swig bought 350 California for $215/sf, Ridge Capital paid $255/sf for 180 Howard St., and Strada may be buying 201 Sper St. for under $300/rsf. These properties were all valued in the $600-800/sf range before Covid. There appears to be one of two directions these bargain-buyers are going. In an $80/sf annual rent market some are pricing their buildings at $40/rsf., possibly impacting the entire office market’s rent direction. On the other hand, some owners are adding amenities ‘like fitness space, a health space, on-site concierge medical services, a rooftop bar and restaurant, event space -list goes on.” …”It could be five years from now or more before the tide of demand for office n San Francisco begins lifting the ships of those properties.”