3rd Quarter 2015 SF Market Highlights

Change from last Change from last Change from last
  All Markets Year QTR Class A Year QTR Class B Year QTR
Vacancy Rate 6.8%
2.1%
3.9%
Direct Rental Rate $53
$60
$49

Major Lease Transactions


RSFBUILDING
Uber 172,838555 Market
Stripe300,000510 Townsend
First Republic Bank103,000388 Market
Lending Club133,534595 Market
AON53,180425 Market
Instacart56,22850 Beale
Mixpanel60,593The Orrick Building
Lending Home
Slack Technologies
31,910
37,815
One California
155 5th Street

Select Top Sales


Price
$/SF

Buyer
Seller
50 Fremont$640M
$783
Salesforce.com, Inc.TIAA-CREF
One Market Plaza$610M
$832

The Blackstone GroupPrime Property Fund, LLC
50 Beale Street
225 Bush
650 California
275 Battery
$395M
$350M
$309M
$307M
$597
$587
$646
$644

Paramount Group, Inc.
Genzon Group
Columbia Property Trust
Rockpoint Group LLC
The Rockefeller Group
Flynn Properties
Tishman Speyer
TIAA-CREF

Looking forward


The San Francisco office vacancy rate ticked up from 6.8% to 6.9% for the quarter with steady or slight gains in rents. Notably, sublease space is up 5% over the 1st quarter representing 13% of total available space. While shedding space can be a leading indicator of a market slowdown, developers remain optimistic. Four projects were delivered in the quarter totaling 956,400 square feet and 6,082,000 is under construction, the majority of which is preleased to tech companies. Total office sales are up for the quarter with 13 transactions over 15K square feet averaging $672 per square foot. Rents are expected to remain high throughout the year. The retail and industrial markets are also experiencing vacancies at historic lows and high prices.