Published 5:12 pm, Friday, April 1, 2016
A: Commercial property supports commerce, jobs and revenue. Any slowdown in this sector would suggest instabilities for the residential sector as well.
But is this happening in San Francisco?
I haven’t seen deep rental or sales discounts or long days on the market. O0n the contrary, rental spaces that have come onto the market have had tremendous interest and demand, and this demand outnumbers the sales inventory.
Even with hundreds of new residential condominium under construction, San Francisco will continue to have a supply deficit with the influx of new permanent residents coming here for the increasing number of jobs. According to a recent study, between 2014 and mid-2015, about 134,000 new jobs were created in the Bay Area
If anything, the commercial market is adjusting, and not actually slowing down.
Juliette Vo,
Vanguard Properties,
(415) 967-0108,
A: There will be a direct correlation between what happens in San Francisco’s commercial markets and the East Bay’s residential real estate. Our job market has driven some remarkable wealth creation and real estate prices.
In turn, this has been able to fund start-ups and expansion of already established businesses and the incredible increase in our real estate prices.
It appears that the San Francisco commercial market has become so expensive that many of these start-ups and businesses are leaving and many are headed out of the city and moving to the East Bay.
Uber’s Oakland headquarters brings 2,500 new jobs to the East Bay, which will increase the desirability and prices of homes there. Being close to corporations in major cities will always be important to commerce, and this is one of the reasons why our housing market has been in consistently strong demand.
The East Bay housing market can only prosper as more companies and their employees are priced out of the city.
the Grubb Co.,
(510) 541-1754, heafey@grubbco.com.
A: A slowdown in commercial real estate could signal a shift in the economy. Such a shift could lead to slower job growth or even job losses. If that were to happen, it would have a real impact on residential real estate, leading to fewer qualified buyers which in turn would impact demand. That would then affect values and how fast property sells.
With potential increases in unsold properties, prices could pull back, with the condo market being the first to take a hit. The single-family home market always tends to remain solid.
Any slowdown would have to be significant to have a real negative impact. Many buyers certainly are in need of a place to live. Yet San Francisco is unique. There are also buyers who just want to own homes here even if they don’t necessarily plan on living here.
Several of my contacts are cautiously optimistic. Let’s not forget that San Francisco is the tech center of the universe. Any weakness would be temporary. If people stop using mobile devices or stop living in houses, I’d start worrying. My take? Not going to happen.
Coldwell Banker,
(415) 846-1899, fc94114@aol.com.