Regions West | San Francisco
July 23, 2008
A total of 700,000 square feet of sublease space flooded the San Francisco office market over the last three months, pushing the overall availability rate to 14.8 percent, an increase of 1.6 percentage points as compared to the first quarter of 2008. Also, Class A availability rose by 0.8 percentage points to 14 percent, according to the San Francisco Studley Report. Among the significant sublease opportunities currently available are Sharper Image’s 63,000 square feet at Hills Plaza, data security firm Vontu’s 54,000 square feet at 475 Sansome, and California Pacific Medical Center’s 55,692 square feet at 633 Folsom Street.
Overall asking rental rates were stable during the second quarter, inching up to $37.70 per square foot. Class A asking rents were also flat on average, equaling $46.49 per square foot. Leasing activity continued to decline in the second quarter. Four-quarter trailing leasing fell from 7.7 million square feet in the first quarter to 7.2 million square feet in the second quarter, an 11.2 percent drop from a year ago and 12 percent below the historical average of 8.2 million square feet. Firms are gravitating toward less expensive Class B and C space. The largest transaction of the quarter was McCann Erikson’s 112,000-square-foot lease renewal at 600 Battery Street. This was followed by DLA Piper’s 82,782-square-foot transaction at 555 Mission Street, the 550,000-square-foot project nearing completion, and Chevron’s 51,800-square-foot lease renewal at 345 California Street.
A total of 700,000 square feet of sublease space flooded the San Francisco office market over the last three months, pushing the overall availability rate to 14.8 percent, an increase of 1.6 percentage points as compared to the first quarter of 2008. Also, Class A availability rose by 0.8 percentage points to 14 percent, according to the San Francisco Studley Report. Among the significant sublease opportunities currently available are Sharper Image’s 63,000 square feet at Hills Plaza, data security firm Vontu’s 54,000 square feet at 475 Sansome, and California Pacific Medical Center’s 55,692 square feet at 633 Folsom Street.
Overall asking rental rates were stable during the second quarter, inching up to $37.70 per square foot. Class A asking rents were also flat on average, equaling $46.49 per square foot. Leasing activity continued to decline in the second quarter. Four-quarter trailing leasing fell from 7.7 million square feet in the first quarter to 7.2 million square feet in the second quarter, an 11.2 percent drop from a year ago and 12 percent below the historical average of 8.2 million square feet. Firms are gravitating toward less expensive Class B and C space. The largest transaction of the quarter was McCann Erikson’s 112,000-square-foot lease renewal at 600 Battery Street. This was followed by DLA Piper’s 82,782-square-foot transaction at 555 Mission Street, the 550,000-square-foot project nearing completion, and Chevron’s 51,800-square-foot lease renewal at 345 California Street.
Recent San Francisco Headlines
Dec. 23, 2008
Dec. 09, 2008