CoStar State of the Market-East Bay Oct. 21, 2025
Nigel Hughes, Senior Director of Market Analytics for CoStar gave an excellent presentation yesterday on the state of the East Bay market. A lot of sobering facts…Healthcare is one of the sectors increasing their office and medical space, as is AI, while most of the other more traditional components of office leasing (financial, law, services) are still downsizing or holding firm but not growing. Pre-Covid the East Bay experienced 26,000 new jobs a year but future growth is projected to be 6,000/year. Population growth is expected to go down to less than 1% annually. Twenty percent of workers do it from home which is way down from just a few years ago. There were 46 new startups during the past quarter which each raised more than $100 million. Total VC investment in Bay Area AI companies in Q3 was $30 billion, representing 30% of the global new VC investment. He also showed a chart with about 75 regions of the United States, ranking them in terms of best to worst office markets, and the East Bay came in dead last. The predictions for the next five or so years…flat for office, with too much space still in San Francisco (31% according to real estate sources) for the trans-bay office relocations which has propelled East Bay office success in the past. Hunker down, hang on, and office will be a lot more fun, when the year is 2031!
