This was  the headline of a Bisnow report from a few days ago, citing 42 million square feet of new subleases hitting the market with 73 U.S. markets reporting negative absorption. Then the next day the Colliers ‘Disruption 2020: Office Sublease Continues To Rise, reporting that sublease space is 30 million higher than it…Read More→

One idea is, using your exclusive tenant rep broker, to go after office subleases that might be much larger than your initial requirement but can accommodate your growth longer-term, and then make aggressive offers (yes, I know this will irritate some listing  agents) 50% or even 25% of asking…in today’s market there may be Sub-landlords…Read More→

I’ve been researching just how safe elevators are during a pandemic, and while the risk factor might be low, you are still better off not having to ride in one. Is the cab small, limited to just one or two people, or  is it a larger elevator cab that can hold 4 standing 6 feet…Read More→

Maya Donnon, Sven Schroeter of KSS Architects (among other co-authors) in a Corenet Global article titled ‘Why Workplace’ discuss the paradox corporate America is going through. They cite Facebook who has committed remote work as a permanent option for its employees while at the same time committing to millions of feet of new office space….Read More→

BISNOW Oct. 30, 2020 reports that real estate companies think they’ll need less office space. “More than any other industry, real estate has a vested interest in making sure office occupiers don’t cut their real estate footprint. Office is the largest of the real estate asset classes, and a reduction in demand would lead to…Read More→

At a recent SIOR National Conference I heard of Amazon 3-5 story 70’ clear warehouses, 3-story warehouses for high-valued land, last mile, using steel supports and costing three times the normal cost of a warehouse, and one of the largest warehouse developers in the world said we had a demand for 400 million square feet…Read More→

  Stephen Newbold, National Director of Office Research for Colliers International reported that in Q3 of 2020 the United States experienced 33.5 million sf of negative absorption and office subleases in the US hit a record at 168.8 million sf. This is more distressing than we experienced during the Great Recession. The bad news was…Read More→

  A number of large office users have delayed the return to their offices until mid-2021, while others have told their employees they can work remotely permanently. Facebook and other major players have allowed their employees to relocate to lower-cost regions, some taking a pay cut but still saving substantially over their previous San Francisco…Read More→

The downtown San Jose Google 79-acre development currently in planning stages will have 5,900 residential ‘dwelling units’, 500,000 square feet of retail stores, restaurants and cultural buildings, and 7.3 million square feet of office space. In the old days this might translate to 35-45,000 employees, and after Covid is gone may again be at this…Read More→

  Office subleases are hitting the markets bigtime, from New York to San Francisco, Boston, Houston and many other major markets. Millions of square feet of excess space, with millions more expected to follow. Companies are finding that they can not only survive with working from home, many are thriving, despite the absence of corporate…Read More→

Bloomberg News reported September 25, 2020 that Deutsche Bank AG is considering a hybrid model of allowing staff to split work between office and home, although a Morgan Chase spokesperson warned that staff productivity might slip if they work remotely too long, and a UBS Group spokesperson commented that working from home makes it harder…Read More→

According to SocketSite, which tracks the San Francisco rental market, year-over-year apartment rents were down 20S%. The Bay Area regional planning agency, The Metropolitan Transportation Commission, is considering a mandate that large Bay Area employers have 6-% of their work force permanently work from home. Reported in today’s  East Bay Times, ‘Significant increases in available…Read More→

  A report just out by the California Economic Forecast predicts more doom and gloom than I would have liked to have read. “The economy however is not back to the pre-crisis status. During most of Calendar 2020 and in much of the first half of 2021, ongoing economic restrictions will have resulted in millions…Read More→

A report just released by Colliers International on the top 25 US Metro Office Markets, show Atlanta on top with 2,055,717 sf of YTD positive net absorption, while New York (Manhattan) had a negative net absorption of 3,375248 sf and San Francisco had a negative net absorption of 3,004,410 sf. Other notables was Seattle with…Read More→

  Something for employers to caution employees who are thinking of moving to a lower-cost state but continuing to work remotely. In an article in the New York Times, there are some states that will tax your income based on where you did the work, and others based on your residence, and it is possible…Read More→

Rich Commercial Realty in Raleigh, North Carolina recently had a survey of thousands of their clients, vendors and contacts asking about the current usage of office space. 69% reported currently occupying their space, and those who hadn’t and asked when, 25% said the next three months, 13% said the next six months, and 62% weren’t…Read More→

On the day Pinterest announced paying $89.5 million dollars to cancel a 490,000 square foot office lease they had previously signed for a project that was going to be built in San Francisco’s South of Market, due to a change of where employees would be located, developer Jay Paul announced it is going ahead with…Read More→

San Francisco now has an estimated 6.5 million square feet of office sublease space. Direct Class A rents are still among the highest in the country, averaging $84 an annual square foot, but Class B rates are now in the $50-60/rsf range. In the Bay Area several companies have announced they will relocate their headquarters…Read More→

A number of regions are reporting an avalanche of new office sublease space. I was on an SIOR national broker call and my associate in Dallas, Texas said they had 4.6 million square feet of new office sublease space come on the market in just the past three months. She reported that in one day…Read More→

I have been reading more and more about folks paying astronomical rents (ie $5-6,000 for a two-bedroom in SF) or crazy-high home prices (median home price in San Francisco $1.3 million) packing up and heading to Lake Tahoe, to Austin Texas, and other regions. I have associates who moved to remote areas of California where…Read More→

It was expected by many in the office industry that with the pandemic now in its 6th month occupancy levels would be in the 25-50% range, but a number of national landlords report occupancy much lower. “Oxford Properties U.S. Head Office Chris Mundy said his firm had initially expected buildings would reach around 25% occupancy…Read More→

There has been a lot of hype on the world getting a vaccine in late 2020, or early 2021, after which life will hopefully return to normal. However the announcement by one of the smartest and largest corporations in the world, Google, that they will let employees work from home until at least July 2021…Read More→

www.bisnow.com reported today that New York City brokers do not feel very confident in the current and future state of the real estate market, and in a Real Estate Board of New York Broker Confidence report released yesterday averaged 1.94 out of 10 this quarter. “In their general written comments about the market, brokers cited…Read More→

I attended a webinar this week with office specialists from JLL, C&W, Cresa and Newmark Knight Frank, representing San Francisco, the Peninsula, the East Bay and Silicon Valley. In San Francisco for the most part when March hit, the world just stopped.  Nothing was happening, and tenants only did what they had to do. Along…Read More→

First off, I am in no way an expert in this but just an office broker who has spent many decades representing office tenants in their space needs. However, I have been doing a lot of reading and researching. If your building has openable windows, great, let the outside fresh air in. Most newer buildings…Read More→

In an article today in GlobeSt.com, a recent survey by Gensler found that only 12% of workers want to work full-time from home and 70% said they want to spend most of their week in the office. “Meetings, socializing and impromptu face-to-face interactions with colleagues were ranked as the top reasons people wanted to head…Read More→

In my morning paper the headline read “249 experts agree: Virus lingers in the air indoors”. This got me to thinking how safe are office spaces in today’s pandemic environment? Asia has been repopulating many of its corporate offices months before the U.S. and I couldn’t find any reports one way or the other. There…Read More→

Reported in TechCrunch this past week: 63% of the startups surveyed by Founders Forum with Tech Crunch said they would re-open in 1-3 or 3-6 months, regardless of when the government told them it was safe to do so. A small number have re-opened their offices, 10% have closed their offices permanently and many said…Read More→

The Society of Office and Industrial Realtors (SIOR), of which I have been a proud member for over thirty years, interviews top brokers on a variety of issues and publishes these interviews. Neil Dailey, SIOR, office broker with McGraw Commercial Properties in Tulsa, Oklahoma, stated this about the new view of office buildings: “I also…Read More→

Nikkei Asian Review just reported that Fujitsu will cut their office space in Japan in half over the next three years. Teleworking will be made a standard practice, and Fujitsu has introduced a policy that will limit the number of employees in the office at any one time to just a quarter to its total….Read More→

Triple-net real estate investment owners often take a lower rate of return, sometimes in the 5-7% annual range, with increases every five years, long 20-30 year leases, credit tenants or strong franchises just to protect their investment. Many of these investments are absolute triple-net, which covers the owner.  If a hurricane tears down the building…Read More→

Real Capital Analytics, which tracks national commercial real estate sales, reported on June 25, 2020 that May sales volume was down 79% year over year.  Industrial was the best performer category (only down 70%), office volumes were down 82% and apartments were down 81%. Retail dropped 83%, and all of the above looked comparatively strong…Read More→

There have been a number of reports, both regionally as well as nationally, that predict corporations will begin leasing suburban office space to accomplish several goals. First, they need to increase employee separation during the pandemic, and it is much cheaper to lease space in the suburbs to accomplish this. Secondly, companies that are above…Read More→

San Francisco has over 4.5 million square feet of available office space for sublease, and some brokers are predicting that this may cause direct office space rents to drop by as much as 10-20%. The Covid-19 is not the only reason for this spike in available space. There were a number of new office projects…Read More→

In National Real Estate Investor June 2020 Elaine Misonzhnik writes on page 3, “The virus might be with us indefinitely. (The World Health Organization has predicted it might take up to five years to get it under control.) And to declare the end of cities, decide that everyone should work and learn from home permanently…Read More→

To quote Michael Tannenbaum, CFO of BREX, “Think of the office as a perk what you offer…when you start to think of it has a perk, you can start to say, are we getting the value out of this office relative to other things we can be offering?”.  I have to totally disagree with this…Read More→

Julie Taylor, Executive Vice President with Colliers International, was interviewed in a podcast on June 24, 2020 by THEREGISTRY about the current situation and future prognosis for San Francisco Bat Area retail. Here are a few highlights from this. Retailers are reexamining their supply chains and may look for multiple routes, and more domestic vendors…Read More→

The Society of Industrial and Office Brokers (SIOR), the elite national organization of the top office and industrial brokers in the country, just surveyed their membership. One SIOR commented he has seen rent discounts of between 10 and 13 percent due to the COVID-19 pandemic, and that during the last three down cycles rents ended…Read More→

Apartment rent collections nationwide which were in the 90+% range the past few months appears to have sunk to the 82% level. Retail rent collections reported in the 25% range. At some point this will impact the banking and financial sectors when landlords cannot pay their mortgages without sufficient rents coming in. Will this lead…Read More→

Salesforce, with 9,000 employees in three San Francisco office towers, will have temperature scans on every floor, mandatory masks, six-foot separations, hand sanitizers everywhere and cleaning throughout the day. Work areas and conference rooms will be at half-capacity or less and employees will arrive at staggered times. The Bay Area Council surveyed 123 companies last…Read More→

As this issue is in print, it was prepared well before COVID-19 came on the horizon, but was just recently distributed.  One big headline read “Regardless of where you fit into the commercial real estate system, or what asset class(es) you work with, one thing is for sure: 2020 will be a year to remember!”…Read More→

Twitter just announced to its 1,000 San Francisco office employees that if they wanted to continue working from home, they could on a permanent basis. What will happen to Twitter’s very cool downtown HQ remains to be seen. The San Francisco Business Times also interviewed a number of smaller 2,000-4,000 square foot office users in…Read More→

Miriam Hall of Bisnow reported yesterday that Vornado Realty Trust said two-thirds of delinquent tenants were credit-worthy, ‘but businesses are hurting and the future is uncertain’.” Vornado collated 90% of office rents and 53% of retail rents in April and May looks to be similar. Office occupancy is currently 5%. Vice-Chairman David Greenbaum said “I…Read More→

Bisnow just reported a study by CoreNet, which is the corporate real estate directors organization, that based on a survey conducted between April 22 and April 27, 2020, polling its 11,000 person membership, 69% of corporate real estate professionals said their company would take less real estate after spending time working from home. Another survey…Read More→

According to a recent Savills Research report, over the past several months since the shelter-in-place shutdown of office buildings there has been a 300% increase in office sublease availability, with over 3.7 million square feet of space currently available. “It is likely that sublease space will increase further – placing downward pressure on overall asking…Read More→