July 19, 2022 · less than 3 min read
The 9-5 commute? I don’t know her.
When a trickle becomes a stream
The pandemic was always likely to shake the established order of things from top-to-toe. Long-time tech hub it may be, but the rise of remote working has changed everything, and San Fran is starting to feel the heat.
Tech heads have decided that the office just doesn’t do it as much as it used to, and they’re moving out of San Fran altogether, or at the very least, are moving further away from the city. It’s not just the workers either – businesses are ditching the mega prices of San Fran for cheaper shores elsewhere. So much so, that in 2021, San Fran took a tax hit to the tune of $400 million.
Taking the edge off
San Fran Mayor, London Breed, has been keen to try and downplay the scale of the ‘downsizing’, but checking out the figures, it’s really not a pretty sight. Some of the largest private sector employers have massively scaled down their investments in the city – Salesforce, the biggest private employer, has cut its office space for the third time since the start of the pandemic.
It’s not all on the downwards path, with some employers like Google trying to up their role in the SF tech sector, but as far as scale goes, it really is all change in the city.
So, what does this mean for you? The San Fran commercial property market is looking at a hefty cool down in prices, with the office vacancy rate now standing at over 24%. The state is still a land of milk and honey for many businesses, but there’s a lot of doubt about whether commercial property will return to its highs of only a few years ago.
This said – is it too early to write off a reinvention of office space? With remote working now the norm, if colleagues do come into work, it’ll be to enjoy the company of colleagues and collaborative working. For this reason, co-working and mixed-use offices may still have the last laugh.
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