While the vacancy rate for larger, multi-unit apartment buildings in San Francisco had only ticked up from around 5 percent in the second quarter of last year to around 6 percent in the second quarter of 2020, that single percentage point increase represented around 1,500 newly vacated units, or around 3,000 newly vacated bedrooms, for a total of roughly 9,000 vacant units spread across the city as of the end of June.
And based on a proprietary review of all leasing activity and availability at ten of the larger apartment buildings in San Francisco, including buildings in Hayes Valley, Dogpatch, Mid-Market and Downtown, representing over 3,000 units combined, we’re seeing an average vacancy rate approaching 9 percent (which doesn’t include new buildings with even higher vacancy rates that were never fully leased, such as Related’s Hub District tower at 1550 Mission Street).
But there’s another wave of vacancies on the horizon as well.
In fact, while the current average vacancy rate is approaching 9 percent in the buildings we reviewed, there are an equal number of apartments that are set to be newly vacated over the next two months as leases, which aren’t slated to be renewed, expire. And there is at least one big building in the city, which had been fully occupied, which is facing a vacancy rate of 20 percent by the end of November and another which is on track for a potential vacancy rate of over 30 percent by the end of the year.
We’ll keep you posted and plugged-in.