It’s no surprise that within a 24 hour time period the Silicon Valley real estate market can make drastic changes, dancing along the price, occupancy and inventory charts – let alone an entire year. Here’s a jam-packed list of the major headlines for Commercial Real Estate pertaining to Silicon Valley, California’s technology hot spot.
- Facebook was responsible for the largest office lease in San Francisco for 2018. The social media giant leased over 1.1 million square feet in San Francisco, making it the third-largest tech tenant in the city following Uber and Salesforce.
- Silicon Valley made for about 21% of the nation’s new office construction.
- A collection of major retailers went extinct leaving business owners and real estate professionals to get creative with how big box spaces will be utilized in the future. Toys ‘R Us, Kmart, Sears, Macy’s, J.C. Penney, Walgreens, GAP were among the few to officially close many, if not all existing stores in 2018 as E-commerce steals the spotlight.
- New building designs omit concrete in the structural framework in attempts to be more eco-friendly. Imagine the structural deficiency potential there – yikes.
- Confident foreign capital continues chasing U.S. Commercial Real Estate.
- High tech accounted for nearly 20% of office leasing in Silicon Valley in 2018.
- High overall mature market growth in 2018, right behind Northern Virginia.
- Senior Housing occupancy trends plummeted as independent living occupancy rates sky rocketed. Could this correlate with medical advances and the ability for the elderly to remain independent and healthier for longer periods of time?
- Commercial real estate prices rose across a multitude of sectors/industries by about 7% compared to the same period last year, according to Real Capital Analytics’ Commercial Price Property Index report.
As the economy strengthens and the ever-anticipated economic correction surfaces, only time will tell what lies ahead in 2019 for commercial real estate in Silicon Valley.