SAN FRANCISCO—San Francisco leads the national office market, with more space under construction than any other city. The estimate to be pumped into the CBD tops the charts at 3.5 million square feet which is expected to be delivered this year, according to Marcus & Millichap National Office Property Index.
Tech firms are driving demand, with significant relocations and expansions in Mid-Market, SoMa, the Financial District and beyond. With tech fueling much of the real estate activity, it is creating an insatiable appetite for the latest tech-laden class A-office and multifamily space, according to RealShare Bay Area experts. Today's office users have far-reaching demands when it comes to technology and space requirements. In the case of tech users' requirements, oftentimes those are very complex data or connectivity ones.
In preparation for the upcoming session at RealShare Bay Area on July 14, Jonathan Allen, principal at Avison Young and moderator of the panel, "Officing Today's Talent: Development and Demand," tells GlobeSt.com: “Bay Area companies continue to challenge the way they use office space. Occupiers seek to secure the top talent, define a culture and achieve efficiencies against a backdrop of an increasingly competitive market for both talent and expensive office space. With Lending Club for example, we were able to secure an 'off-market' dramatic and architecturally significant space in an adjacent building. The strategy has created a 'European Plaza' feel to maintain the company's collaborative culture, and promotes the brand in this highly visible location.”
Another issue to consider is the need to create space that attracts and retains talent, given that Bay Area salaries often don't keep pace with rising housing prices. Spaces, such as the one being created for online and mobile app payment platform, Stripe, at 510 Townsend, illustrate the concept of including groundbreaking technology while blending in company personality and attracting talent.
Joel Marcus, CEO and founder of Alexandria Real Estate Equities Inc., 510 Townsend's developer, tells GlobeSt.com: “The interior is expected to be open and collaborative with a comfortable environment including personality such as a rooftop patio overlooking SoMa.”
The space is likely to incorporate a café and lounge, areas for collaboration and heads-down work, all with a look and feel that goes with Stripe's brand and overall vibe.
“We work to create identities for companies,” continues Marcus. “This location will provide a unique identity for Stripe as it seeks out and attracts the best tech talent out there.”
Some key issues to consider when configuring office space include current market trends, specific user workplace requests, technology demands, creating unique work spaces to take a company's personality into consideration, accommodating user growth needs and engineering efficient buildings, all while keeping the other issues in mind.
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
