Market Trend: East Bay/Oakland’s Retail Vacancy Stays at 5.0%

Net Absorption Positive 65,878 SF in the Quarter
By Bryce Meyers
July 26, 2013

The East Bay/Oakland retail market did not experience much change in market conditions in the second quarter 2013.

The vacancy rate went from 5.0% in the previous quarter to 5.0% in the current quarter. Net absorption was positive 65,878 square feet, and vacant sublease space increased by 11,951 square feet. In first quarter 2013, net absorption was positive 288,791 square feet.

Tenants moving into large blocks of space in 2013 include: Nordstorm Rack moving into 47,000 square feet at 703 Contra Costa Blvd; 24 Hour Fitness moving into 44,656 square feet at 4500 Auto Mall Pky; and 24 Hour Fitness moving into 38,400 square feet at 2800 N Main St.

Quoted rental rates increased from first quarter 2013 levels, ending at $20.94 per square foot per year.

A total of 3 retail buildings with 56,818 square feet of retail space were delivered to the market in the quarter, with 325,175 square feet still under construction at the end of the quarter.

This trend is compared to the U.S. National Retail vacancy rate, which decreased to 6.7% from the previous quarter, with net absorption positive 23.11 million square feet in the second quarter. Average rental rates increased to $14.50 this quarter, and 593 retail buildings delivered to the market totaling almost 9.6 million square feet.

San Francisco median home price hits plateau?

After soaring to the sky like Icarus, the San Francisco median price for sold homes has finally fallen. Not as dramatically as Icarus fell, mind you– more like a gentle downward current pushing that price point from $915K (for both condos and single-family homes) in May of this year, down to $870K in June and then slightly up from there to $879K in July, staying fairly flat into August.

Meanwhile, a perusal of the MLS for San Francisco homes listed within close range of the current median of $879K reveals a market still rather over-heated. For instance, this unit on Ashbury is 2 beds, 2 baths, 1,300 square feet, listing at $899K. It is a recent conversion to a condo, and includes a shared yard, 1-car parking and extra storage. Still, that’s almost $700 per square foot.

San Francisco: Apartments converting back to condos

by Bill McBride on 8/18/2013 07:57:00 PM

From Carolyn Said at the San Francisco Chronicle: Bay Area rental pendulum swings to condos

Some condominium complexes opened at the worst possible time – in the depths of the real estate downturn when home buyers were few and far between. They coped by becoming for-rent apartment buildings instead. But now, as the housing recovery accelerates, several East Bay and South Bay developments are switching back to for-sale condos.

For instance, the 125-unit Broadway Grand in Oakland, developed by Signature Properties, first opened as a condo complex, sold 17 units, and then switched to rentals as the market tanked … Last year it went condo again, and now has sold all but 11 of its units.

Similarly, the Skyline in San Jose with 121 units is now switching to condos after opening as rentals during the downturn. In Emeryville, the 424-unit Bridgewater is switching from rentals to condos. The current phase II, which started in June with 174 homes ranging from $185,000 to $450,000, is finding a receptive audience, said Alan Mark, president of the Mark Co., which is marketing the complex.

The conversion of these condo projects to apartments was an interesting story during the housing bust (and a way to take excess “for sale” inventory off the market) – and now they are converting back to condos (taking advantage of the lack of “for sale” inventory). This is similar to a story by Cale Ottens at the LA Times last week: Condo conversions inch up in Los Angeles.

Market Trend: San Francisco’s Office Deliveries, Construction and Inventory

By Bryce Meyers
August 9, 2013

During the second quarter 2013, one building totaling 11,192 square feet were completed in the San Francisco market area.

This compares to one building totaling 2,049 square feet that were completed in the first quarter 2013, one building totaling 170,618 square feet completed in the fourth quarter 2012, and 257,097 square feet in one building completed in the third quarter 2012.

There were 1,067,247 square feet of office space under construction at the end of the second quarter 2013.

Some of the notable 2013 deliveries include: Quadrus Office Complex – Bldg 9, a 11,192-square-foot facility that delivered in second quarter 2013 and is now 100% occupied, and 1580 Laurel St, a 2,049-square-foot building that delivered in first quarter 2013 and is now 100% occupied.

The largest projects underway at the end of second quarter 2013 were 535 Mission St, a 307,235-square-foot building with 0% of its space pre-leased, and Foundry Square III, a 286,375-square-foot facility that is 0% pre-leased.

Total office inventory in the San Francisco market area amounted to 161,975,516 square feet in 3,750 buildings as of the end of the second quarter 2013. The Class-A office sector consisted of 74,192,662 square feet in 295 projects. Within the Office market there were 189 owner-occupied buildings accounting for 17,097,030 square feet of office space.

This trend is compared to U.S. National Office deliveries and construction, which saw 219 buildings totaling 10.26 million square feet complete construction, with an additional 71.06 million square feet of office space still under construction at the end of the second quarter. A 685,000-square-foot facility at 200 S 108th Ave. in the Omaha/Council Bluffs market delivered, while the 3.02 million-square-foot One World Trade Center in New York City is still underway. Total office inventory in the U.S. market area totaled 10.34 billion square feet in more than 493,000 buildings at the end of the second quarter 2013, including almost 20,000 owner-occupied buildings accounting for 879.9 million square feet.

The information in this news report is based on CoStar’s Second Quarter 2013 Market Report, a 40+ page comprehensive research report available to CoStar subscribers. To learn more about quarterly research reports and other benefits available to CoStar subscribers, please call 888-226-7404.

San Francisco: Apartments converting back to condos

Sunday, August 18, 2013

by Bill McBride on 8/18/2013 07:57:00 PM

From Carolyn Said at the San Francisco Chronicle: Bay Area rental pendulum swings to condos

Some condominium complexes opened at the worst possible time – in the depths of the real estate downturn when home buyers were few and far between. They coped by becoming for-rent apartment buildings instead. But now, as the housing recovery accelerates, several East Bay and South Bay developments are switching back to for-sale condos.

For instance, the 125-unit Broadway Grand in Oakland, developed by Signature Properties, first opened as a condo complex, sold 17 units, and then switched to rentals as the market tanked … Last year it went condo again, and now has sold all but 11 of its units.

Similarly, the Skyline in San Jose with 121 units is now switching to condos after opening as rentals during the downturn. In Emeryville, the 424-unit Bridgewater is switching from rentals to condos. The current phase II, which started in June with 174 homes ranging from $185,000 to $450,000, is finding a receptive audience, said Alan Mark, president of the Mark Co., which is marketing the complex.

The conversion of these condo projects to apartments was an interesting story during the housing bust (and a way to take excess “for sale” inventory off the market) – and now they are converting back to condos (taking advantage of the lack of “for sale” inventory). This is similar to a story by Cale Ottens at the LA Times last week: Condo conversions inch up in Los Angeles.

Market Trend: East Bay/Oakland’s Office Deliveries, Construction and Inventory

August 9, 2013

During the second quarter 2013, no new space was completed in the East Bay/Oakland market area.

There was one building totaling 64,035 square feet that completed in the first quarter 2013, two buildings totaling 83,000 square feet completed in the fourth quarter 2012, and 164,000 square feet in four buildings completed in the third quarter 2012.

There were 68,640 square feet of office space under construction at the end of the second quarter 2013.

The only delivery in 2013 has been Pleasanton Corporate Center – Bldg F, a 64,035-square-foot facility that delivered in first quarter 2013 and is now 100% occupied.

The only project under construction at the end of second quarter 2013 was 1441 E 31st St., a 68,640-square-foot building with 100% of its space pre-leased.

Total office inventory in the East Bay/Oakland market area amounted to 113,571,086 square feet in 5,682 buildings as of the end of the second quarter 2013. The Class-A office sector consisted of 26,334,425 square feet in 103 projects. Within the Office market there were 204 owner-occupied buildings accounting for 12,900,329 square feet of office space.

This trend is compared to U.S. National Office deliveries and construction, which saw 219 buildings totaling 10.26 million square feet complete construction, with an additional 71.06 million square feet of office space still under construction at the end of the second quarter. A 685,000-square-foot facility at 200 S 108th Ave. in the Omaha/Council Bluffs market delivered, while the 3.02 million-square-foot One World Trade Center in New York City is still underway. Total office inventory in the U.S. market area totaled 10.34 billion square feet in more than 493,000 buildings at the end of the second quarter 2013, including almost 20,000 owner-occupied buildings accounting for 879.9 million square feet.

San Francisco’s East Bay Real Estate Market Continues Hot Streak

San Francisco, CA — (SBWIRE) — 08/21/2013 — The July numbers are in and the Bay Area housing market continues to remain strong, with impressive growth in both pricing and pending sales, all according to the latest numbers from DataQuick.

In Alameda County, the median sales price of homes increased 30.9% from last July to $615,000 – up from $470,000. The number of homes for sale was down 25.2%.

“Less inventory and more buyers certainly fuels the increase in the sales price,” says Cindi Hagley, Real Estate Broker with The Hagley Group at Prudential California Realty. “We’re also seeing more international buyers coming to the table with cash, which increases the number of offers and further drives sales price.”

Contra Costa County also saw huge increases across the board. Median sales price in July was up 51.6% at $529,000 – up from $349,000 the previous year. Inventory was down 18.9% in that same time period.
San Ramon, the richest City in America according to Nerd Wallet, a personal finance site, showed a 26.8% increase in sales price, with inventory being up over 21%. Median sales price was $893.000 in July, up from $705,000 the previous year. Pending sales were also up 23.6%.

“Folks fail to mention that the #2 richest City according to that same study was Pleasanton in Alameda County,” says Hagley. “These neighboring communities have great schools, low crime rates, and plenty of choices for first time home buyers, move-up buyers, and investors. Both also have easy access to Bay Area Rapid Transit (BART) making for a very easy commute into San Francisco.”