All Markets Remain Strong Despite Gains in Vacancy Rates.
Redwood City, (October 23, 2018) – The third quarter market research and forecast report produced by Colliers International’s San Francisco Peninsula indicates a surge in demand and record-high average asking rates in office, research and development (R&D) and industrial sectors. According to the leading global real estate services firm, this quarter saw modest increases in vacancy rates, and although this typically indicates a drop in demand, stronger market indicators show the market has no signs of slowing down.
The San Mateo County market experienced substantial growth demonstrated by the large levels of gross absorption, a measure of all leasing activity in a given period, accompanied by the rising average asking rates. In total, the gross absorption reached ±3,059,555 square feet of commercial product, which is ±2,083,943 square feet more than last quarter and ±1,852,890 square feet more than the third quarter of 2017. “The high absorption reflected here is simply an impressive quarter of very strong leasing activity,” said Mike Cobb, Colliers International’s Senior Vice President.
While large tenants like Genentech and Facebook made significant deals on the San Francisco Peninsula, this number results largely from an extremely active three months with a total of 275 deals compared to the 110 deals recorded last quarter. The large amount of transactions combined with the high average asking rates point to a market in the heat of acceleration indicating no change in wind direction for the San Francisco Peninsula’s commercial real estate market. The jump in vacancy is merely the result of normal market fluctuation as available inventory is still fairly limited. Low vacancy and historically high average asking rates demonstrates a hot market with no signs of cooling down.
Download the full report here:
San Francisco Peninsula Q3 2018: http://www.colliersproperty.com/newsletters/rwc.all.news.Q3-18.pdf
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