Market overview
San Francisco office leasing activity has been driven by tech tenants building and expanding their presence in the city. The area’s world-renowned universities churn out STEM talent, and these highly-educated millennial workers want to live, work and play in "The City by the Bay." In an area with one of the nation’s longest and most stressful commutes, tech businesses believe that a San Francisco presence is critical to their success.
Last year, 17 leases greater than 100,000 square feet were signed in the city, with 14 of the 17 coming via tech tenants.
Going forward, with 68.9 percent of the space currently under construction already pre-leased, and a Prop M generated cap on new construction, competition for space could heat up and push rents up further.
Expensive rents and a high cost of living will be challenges to growing tech employers.
Numbers to watch
Nearby universities like Stanford University and the University of California, Berkeley continue to produce tech talent ideal for both startups and established firms alike.
- 61.9% - The population over 25 with an Associates degree or higher
- 57.2% - The population over 25 with a Bachelors degree or higher
- 22.5% - The share of Bachelors degrees that are STEM degrees
- 12.9% - The population over 25 with a STEM degree