Deep Throat: Landscape has become precarious. The economy has now clearly slowed.
We asked for an update from a local brainbox – a venture capitalist whose tenured company has more than 1B invested in public and private tech. We agreed not to disclose the VC’s name, but here’s his POV:
US equity markets rallied very strongly from December 2018 lows in 1Q, following a more dovish tone from the Fed in late January.
The economy has now clearly slowed from the synchronized global growth scenario we saw in 2018. Retail sales and industrial production are up ~3% and ~2% in May compared to 2018 peaks of ~7% and ~5%, respectively.
photo: Wikipedia Commons
The question has become whether the Fed can navigate to a soft-landing slowdown while avoiding a recession. As such, volatility has returned to risk markets over the past couple of months. The trade war has further complicated the matter, adding uncertainty to an already precarious situation. Read more
| Tenant | Address | Sq Ft |
| 88 Bluxome | 430,000 | |
| Asana | 633 Folsom | 268,000 |
| Slack | 45 Fremont | 208,000 |
| 215 Fremont | 140,000 | |
| O’Melveny & Myers | Two Embarcadero Center | 77,000 |
SAN MATEO COUNTY
| Tenant | Address | Sq Ft |
| Snowflake | 450 Concar | 102,000 |
| Zvora | 101 Redwood Shores | 100,000 |
| Zoox | 4100 East Third Ave. | 74,000 |
| Indeed | 1001-1051 E Hillsdale | 37,000 |
| Harpoon Thera. | 131 Oyster Point | 35,000 |
EAST BAY COUNTIES (Alameda/Contra Costa)
| Tenant | Address | Sq Ft |
| Novartis | 5959 Horton | 62,000 |
| Spaces | 46,000 |
| How many blocks of space are available for YOU? | San Francisco County (Q4 2018 v. Q1 2019) | San Mateo County | East Bay Counties |
| 5,000-9,999 sq. ft. | 230/268 +17% |
Call us for | more info |
| 10,000-19,999 | 138/154 +12% |
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| 20,000-29,999 | 48/51 +6% |
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| 30,000-39,999 | 15/18 +20% |
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| 40,000-49,999 | 14/16 +14% |
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| 50,000+ | 35/38 +9% |
San Francisco, aka Camelot:
- 10.4 M square feet available (direct + sublease).
- 8.2% total available. Up 1/2%.
- 4.2M sf under construction (will add 4% to total inventory).
- Market size 121M sf
- Total Net Absorption, 1Q: 164,000 sf.
- 2018 Net Absorption, 5.1M sf.
- Total 1Q leasing activity at 2.7M sf, lowest in 3 years.
- Lowest number of transactions in 10 years.
San Mateo County:
- 5 M square feet available (direct + sublease).
- 9.1% total available. Up 1/2%.
- 2.8M sf under construction (will add 6% to total inventory).
- Market size 52M sf
- Total Net Absorption, 1Q: -20,000 sf.
- 2018 Net Absorption: -53,000 sf.
- Lowest number of transactions in 8 years
Alameda/Contra Costa Counties:
- 12.4 M square feet available (direct + sublease)
- 11.2% total available. Up 1/3%.
- 2M sf under construction (will add <2% to total inventory).
- Market size 111M sf
- Total Net Absorption, 1Q: -262,000 sf
- 2018 Net Absorption, 785,000 sf
- Lowest number of transactions in 9 years.
Santa Clara County (Silicon Valley):
- 15.2 M square feet available (direct + sublease)
- 9.2% total available. Up 1/2%.
- 6.1M sf under construction (will add 5% to total inventory).
- Market size 128M sf
- Total Net Absorption, 1Q: -302,000 sf
- 2018 Net Absorption, 3.42M sf
- Lowest number of transactions in 10 years.
After reading through this Market Editorial, please see our collection of educational articles we’ve written for our tenant community.
The top companies controlling the most space available are NOT landlords….Rather, they are office leasing brokerage firms acting with the landlord’s interest in mind. They are:
CBRE
JLL
Cushman & Wakefield
Colliers
Newmark, Cornish & Carey
Since their allegiance is committed to so many landlords, how can they possibly represent YOUR interests—the tenant’s interests—objectively and aggressively?
- Free preliminary office lease and operating expense review;
- Free consultation to discuss project management, Team formation and project schedule;
- Market surveys and our specific tenant-driven leasing recommendations ; and
- Assistance in selection and coordination of all Team members throughout planning and negotiation phases.
Try it FREE. Griddig improves the entire industry’s performance. Join Landlords, Tenants, Brokers and Service Providers in the LIVE MARKETPLACE and start your next deal today.
We believe that representing tenants – and only tenants – is a noble cause, our specialty for over thirty years. We greatly appreciate our clients’ confidence and kind words about us, our level of advocacy and enthusiasm to negotiate aggressively ….. and mind the details while guiding the leasing process. Thank you!
505 Montgomery Street, Suite 1100
San Francisco, CA 94111
C: 415-999-9244
T: @MihalovichCRE
E: dan@TheSpacePlace.net
W: www.TheSpacePlace.net
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