Six workplace properties, totaling 534,000 sq. toes, modified palms through the second quarter within the Peninsula market. Secondary city properties accounted for many of the area (402,960 sq. toes), whereas suburban submarkets recorded little exercise.
In comparison with different gateway markets, San Francisco maintained a center place for gross sales through the first half of the yr, forward of Miami ($995 million), however behind Manhattan ($2.8 billion), Los Angeles ($2.3 billion) and Chicago ($1.8 billion).
Regardless of the lower in gross sales quantity for the reason that earlier yr, costs continued to extend within the San Francisco-Peninsula market. For workplace properties traded within the first half of the yr, the typical value per sq. foot was $920, up 28.5 p.c year-over-year.
The biggest sale of the second quarter within the San Francisco-Peninsula market occurred within the SoMa submarket. DivcoWest acquired a 305,260-square-foot Class A workplace property for $356 million from Hole. The LEED Gold-certified asset traded at $1,166 per sq. foot, considerably above the market common.
DivcoWest was concerned in one other massive transaction through the second quarter. The corporate offered a three-story workplace asset, additionally within the SoMa submarket, for $71 million to The Sobrato Group. The asset was offered for roughly $1,726 per sq. foot, the costliest out of all properties that traded within the second quarter.
Bay Space Workplace Gross sales Outperform Main Markets
The Bay Space—comprising the East and South Bay—had a really robust second quarter. Workplace transaction quantity throughout this era totaled $1.2 billion, on par with the primary quarter. The market’s life sciences sector continued to draw huge investments, with the primary half of the yr recording $2.6 billion in workplace gross sales—down 27.1 p.c year-over-year. Though recording a decline since 2021, that is on monitor with most metros tracked by CommercialEdge, as most main markets had much less exercise this yr.
Within the second quarter, roughly 2.4 million sq. toes of workplace area modified palms available in the market. Investments had been cut up between major (1 million sq. toes) and secondary (1.3 million sq. toes) suburban markets, whereas a single property—comprising 70,000 sq. toes—traded amongst all city submarkets. The typical value per sq. foot reached $511 as of June, up 1.2 p.c year-over-year.
In June, Tishman Speyer accomplished the most important workplace sale of the yr. The investor offered its Meta-leased campus in Sunnyvale for $707 million to CommonWealth Companions. The tech large leased the whole thing of the 719,037-square-foot property again in December 2021. At roughly $1,006 per sq. foot, the transaction additionally topped the market’s common value.
Other than know-how tenants, healthcare additionally attracted funding. Anchor Well being Properties expanded its portfolio in April. One of many buildings it bought was the 60,000-square-foot Park Place Medical, positioned in Vallejo. The property traded at $242.6 per sq. foot, or $14 million in whole.
In Palo Alto, Wheatley Properties acquired a 34,558-square-foot workplace property for $39.3 million from Tarlton Properties. The asset at 250 Cambridge Ave. modified palms as the costliest asset on a per-square-foot foundation, averaged at $1,094.
CommercialEdge covers 8M+ property data in the US. View the newest CommercialEdge nationwide month-to-month workplace report right here.
