According to the San Francisco Business Tims February 28, 2025, “A majority of San Francisco business leaders said their companies have plans to expand their offices in the city as they both push for more in-person work and grow headcount, according to a survey by KPMG. Three-quarters of the 100 San Francisco-based executives surveyed by…Read More→

I have been writing and publishing the OfficeTimes Corporate Office Perspective for the past 45 years, and during this time I have made many industry predictions. Almost every one of them has come true, and this is documented if you want to check. It almost feels like we are at the office building bottom, but…Read More→

San Francisco and Oakland have been experiencing fire-sale pricing of office buildings over the past few years, with office properties that previously sold for $500-1000/rsf selling for $350-300/rsf/ Very recently we are beginning to hear of I-680 Corridor Class A, well-located office buildings and complexes potentially on the way to Trustee sales in the $100-200/rsf…Read More→

  It took DOGE only six days to terminate 22 Federal leases. GSA oversees the federal government’s 360 million square feet of owned and leased properties.  Landlords with GSA as a tenant may be worried as many leases have early termination clauses. As reported in a January 18, 2018 Colliers Insights report, “Investors and lenders…Read More→

1440 Broadway, Oakland,  a 91,000 square foot office building built from 103-1911, which was purchased in 2018 for $43.5 million, just sold for 5.5 million.  I have seen recent articles claiming we are at the bottom of the office market, and if the bottom was much lower this building would have been free…

“The commercial real estate office fundamentals have not changed and remain weak…we’re 18 months into seeing the losses materialize…we still have quarters to go. We expect the market for office space will remain challenging for several years…” according to Wells Fargo CEO Mike Santomassimo.  San Francisco Business Times 1/30/5 So tenants should take advantage of…Read More→

“The Trump administration is considering selling two-thirds of the Federal government’s office stock to the private sector, according to people familiar with the transition operations. About three-quarters of the 70 million square feet of office space GSA leases from private landlords in D.C. is also likely to be canceled.  The GSA has been working to…Read More→

Robert Half in Bishop Ranch, San Ramon, just announced it was downsizing from 250,000 sf to 73,000 sf, and across the Bay in San Francisco Google just renewed and expanded its offices at Hill Plaza on the Embarcadero from 416,000 sf to 550,000 sf, but before you begin celebrating their expansion, they are also giving…Read More→

It has been suggested to me that I try to put a more positive spin on my blogs regarding the office market…so here goes!  If you ever wanted to purchase a downtown San Francisco high rise office building for 30% of what the price was five years ago, now is your chance!  This week I…Read More→

6001 Shellmond St., Emeryville, a110,000 sf Class A eight-story office building with adjacent shopping and retail was purchased in 2017 for $33 million, and the $21.6 million loan was just purchased for $6.8 million last month. $300/sf before,$62/sf now…

Bisnow headline, The retail apocalypse is back, Why It Seems Like All Of America’s Chains Are closing, then I opened my Morning Brief, “Party City Out Of Business After Nearly 40 Years”,  and the next headline, “The Container Store Files For Bankruptcy”

“Roughly 11% of office buildings tied to CMBS loans were delinquent, beating the previous high watermark of 10.7% set during the Great Recession in December 2012, according to Trepp, which began tracking the CMBS sector in 2000. More than $2B in office loans became freshly delinquent in December, causing a 63-basis-point increase in the overall delinquency rate,…Read More→

One of my colleagues gave me an article,’ Meet the People Who Refused to Go Back to the Office and Lost Their Jobs’. It references Amazon, UPS, Morgan Chase and Boeing mandating that their employees return to the office five days a week. The article quotes workers who were mandated to return, who didn’t and…Read More→

GSA has 78 million sf of office leases either expiring or can be terminated by end of 2028. While there appears to be a push to get all government employees back in the office five-days a week, The American Federation of Government Employees union just reached a deal with GSA to protect and extend hybrid…Read More→

Bisnow reported on Dec. 4, 2024 that Brookfield Properties 8 million square foot office portfolio is now being  powered by nuclear energy.  “It not only sets a new standard for how owners can purchase clean energy, but it’s also a very scalable model that other property owners can follow,” Brookfield Properties Senior Vice President of…Read More→

Snowflake just sublet from Meta 773,000 square feet of office space, and this is significant for several reasons. First, for the San Francisco Bay Area this is a huge office deal, but as importantly, Snowflake previously relocated its headquarters to Bozman, Montana. Like many companies seeking a less expensive place to do business than our…Read More→

I was at a recent broker event with specialists from different commercial real estate segments. Here are some interesting insights from this…the housing market has slowed down; less folks are buying homes and that may have dramatically impacted a number of other industries. Our industrial folks say the construction companies are downsizing, giving up warehouse…Read More→

A double-default is when a real estate borrower has trouble with their loan, either it is due and they are unable o refinance, or they can’t make the payments, and they do a work-out with the lender. The terms are adjusted, or the loan is extended, or other loan modifications so the lender doesn’t have…Read More→

I attended our Fall SIOR National Conference in Los Angeles, and one of the sessions discussed how and why our country will experience increased energy shortfalls. One speaker said that a Chatgpt search uses 17 times more energy than a Google search, and we are seeing huge demand increases for data centers across the Country….Read More→

In BizNow 10/23/24 Jarred Schenke’s article warns about the tax exposure that might result from a landlord handing the keys of the property back to the lender. On top of losing whatever equity you may have once had, in addition to all the time and expense purchasing and then managing the property, there may be…Read More→

Jarred Schenke, writing in NationalCapital Markets,  “In total, roughly $3.3B of CMBS loans were transferred to special servicing during the month of September, $1.9B of which were office loans. Now 12.6% of all CMBS office loans are being specially serviced, up from 8.3% at this point last year. The special servicing rate increased for all…Read More→

  This was the 9/24/24 headline in Bisnow, based on a survey of 1,300 global CFO’s conducted by KPRG….83% said they expect their companies will shift back to requiring five days of office attendance sometime in the next three years. “Older CEOs are much more likely to predict a return to pre-pandemic work models, with…Read More→

According to a recent report by JLL, nationwide lab space availability is now 30% and this is expected to rise further. “The report predicts rents will continue dropping and that it could take years before the local markets work through their supply backlogs.”  This is sobering as this segment of the industry was previously a…Read More→

In San Francisco KPMG just announced it was downsizing from 143,000 sf of office space into 96,000 sf. This is a common trend amount financial services firms. “About 1,000 employees will be based out of the office, the same number based out of 555 Second. Chris Cimino, who leads KPMG’s San Francisco office, said the…Read More→

Bisnow National 9/13/24  had a number of article headlines, including “Business Leaders Look to Increase Real Esate Investments”, Brookfield Predicts Robust Office Recover Market Rebound”, Major Investors Return to the Market”, Commercial Real Estate Investors Ready to Get Back in the Market”…not bad for just one day’s headlines!!!  

Bisnow August 29, 2024, reported that 1 in 6 .S. office buildings are strong residential conversion candidates. On the one hand, it could be viewed as only 1 in 6, while a more optimistic slant would be 17% of U.S. office buildings may be residential conversion candidates.” Manhattan led U.S. markets with more than 53%…Read More→

In a August 22,, 2024 Bisnow article quality office space is now table stakes and to win landlords are shooting for ‘flight to experience.” “It’s really about that experience you feel as you walk in,” Harvest Properties Senior Director of Development Danielle Friend said at the Grand Hyatt San Francisco during Bisnow’s State of the Bay Area…Read More→

Recently I wanted to find out first-hand what tenants were doing with and in their office space, so I picked up a clipboard and personally visited a number of office tenants in suburban Class A office buildings. One complex had a huge, 80% empty, parking lot, Class A, and well maintained. I went door-to-door, not…Read More→

Google has come out and told their employees who haven’t received approval to work from hom that they will have to spend at last three days a week in the office. The Verge posted part of the Google internal memo which read, “We know that a number of people moved to fully remote work for many…Read More→

A recent article in Bisnow July 8, 2024 cited San Francisco Class-A office vacancy increasing for the 10th consecutive quarter, “as more than a third of the city’s office buildings remain empty.  The vacancies, brought on by layoffs and hybrid work, are expected to remain elevated through the end of the year. Placer.ai’s monthly data…Read More→

  A perfect storm of plunging property values for aging buildings, weak tenant demand coming out of the pandemic and high interest rates for new loans and refinancing has left the $2.4 trillion office building sector wobbling. In New York 1740 Broadway which Blackstone had paid $600 million for ten years earlier just sold for…Read More→

There are a number of reports around the country that price discounts on office buildings are a boon to non-profits who have access to cash to acquire these office facilities for their own long-term use. Bisnow June 3, 2024 “With overall U.S. commercial real estate pricing down 21% from its March 2022 peak, according to Green Street,…Read More→

  ”Artificial intelligence is expected to replace 85 million jobs by 2025, according to a report from the World Economic Forum. That has implications for real estate, CBRE Investment Management Chief Investment Officer for Americas Direct Real Estate Strategies Julie Ingersoll said. “If we lose 25% of our jobs in the United States — think coding jobs, secretarial, even sales-related…Read More→

“For the first time since the financial crisis, investors in top-rated bonds backed by commercial real estate debt are getting hit with losses. Buyers of the AAA portion of a $308 million note backed by the mortgage on a building in midtown Manhattan got back less than three-quarters of their original investment after the loan was sold…Read More→

Not sure if it was bound to happen, and also not sure if just because there are mandates the office world will return to pre-Covid occupancy levels, but Bisnow May 24, 2024 reported that “Citigroup, HSBC and Barclays are among the financial institutions planning to tell workers that a return to five days a week…Read More→

Bisnow May 8, 2024, It is not easy or inexpensive, but many office projects have ample parking and are located near residential and commercial areas. “Leopardo Vice President of Healthcare David Rutledge said when developers are looking to build a new healthcare facility from the ground up, they often find that ideal sites like Knightly…Read More→

I’ve had folks tell me the positive news that institutional investors are once again purchasing San Francisco office buildings, which to them is a sign this market is recovering. I remind them that the price might be twenty cents on the dollar, and if you own other office buildings this is a great way to…Read More→

I was in a recent meeting and was made aware of multiple suburban office buildings where the tenants had been on month-to-month and were all finally given notice to vacate.  I met with a major office park investor who is planning on demolishing a number of very nice Class A office buildings, relocating the tenants…Read More→

The Standard, April 24, 2024: “By the end of 2019, the 20 biggest tech employers had leased more than 16 million square feet of space, nearly a quarter of the city’s total office stock. Now, those same companies are holding onto only 8.3 million square feet, according to data from real estate firm CBRE. “We’ve just…Read More→

Christopher Aquilina, SIOR with tenant rep firm Spring 4 n the United Kingdom, , said “Tenants are increasingly understanding that if they want to woo their staff back from WFH (work from home), they need to offer best-in-class office space in a convenient location.” He goes on to say  “Developers need to be part of…Read More→

This may be a new record for the most office space, both direct as well as for sublease, in the United States, according to Avison Young. This is 23.7% of the office inventory in the country. Some positive trends that may improve office Landlord’s assets in this Bisnow April 8, 2024 article, “Swaths of layoffs…Read More→

Amazon Slashing office space, will save $1.3 Billion in Costs. Will let leases expire and negotiate early lease terminations.  Starwood Capital paid almost $500 million in 2019 for three Downtown Oakland office buildings, and after just defaulting on a 364.5-million-dollar loan has given up ownership of 2100 Franklin, 2101 Webster and 1901 Harrison. San Francisco’s…Read More→

I have been predicting for some time that office occupancy will go up over the next few years-in my opinion from the roughly 50% where we are now to perhaps 70% once all the corporate mandates become effective. However, we will not get anywhere close to the pre-Covid levels as there has been a transformational…Read More→

“The self-proclaimed leader of the return-to-work movement is now staring down some of the emptiest office buildings in the country. Houston, Dallas and Austin are the first-, second- and third-most-vacant office markets among the nation’s largest 50 metros, according to Moody’s Analytics.”, according to Bisnow 2/29/24. I still think San Francisco has a higher vacancy, but…Read More→

In Bisnow February 25, 2024, ”Paul Darrah, who is the chief workplace office for Citadel which has $92.46 billion under management, said he believes that the rest of the corporate world will eventually succeed in getting employees to show up. Citadel is leaning into in-office work as the hedge fund posts double-digit returns. It is planning billion-dollar office towers in Miami and…Read More→