With a current vacancy rate of just over 8 percent, the lowest rate since the fourth quarter of 2000, the average asking rent for office space in San Francisco is just over $51 a square foot per year, up 19 percent over the past year and up 65 percent since early 2010 according to Cassidy Turley.
With a little over 1.1 million square feet of net office space leased in 2013, the rate of absorption has significantly slowed as compared to 2012, however, when over 2 million square feet of space was absorbed and is roughly a third the 3.2 million square feet of net space leased in 2011, driven in part by a backlog in the pipeline of new construction which is set to start flowing over the next couple of years.
As we noted yesterday, the East Bay is poised to gain from the spike in San Francisco’s rents.