S.F. vacancy rates dropped almost 2% from the end of 2012 and are expected to continue to slip this year as more companies move into and expand their footprints in the city. (Soon, people will be able to rent out their garages for office space.) A little under 9M SF was leased in 2013, according to a new Avison Young report (CEO Mark Rose, snapped above). In Q4 alone, about 800k SF was leased up by tech companies either expanding or migrating into the city. The top lease of the quarter was Google's 372k SF renewal and expansion at 345 Spear. Some 1M SF is expected to deliver in the city this year, where job growth grew by 4% in 2013.
The number of transactions that occurred in the last part of 2013 and going into this quarter are just astounding, Avison Young managing director Nick Slonek tells us (pending leases include Pinterest, Bare Escentuals, Dropbox, and PracticeFusion). What used to be one or two big deals a quarter is now up to four or five; that's an anomaly, he says. Even in the hottest market in 2001, there were more transactions but nowhere near the same size range. He's never seen so many 100k SF-plus leases signed in such a short amount of time. (He's currently repping undisclosed clients on a few that size.)
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