San Francisco is still lying in wait for its office sector to spring back—but it might have to wait a little longer. A new report from Avison Young expects that the office vacancy rate will remain unchanged through the end of the year.

"The vacancy will continue to remain about the same as it has been this year. We won't see improvements until the return-to-work plans of large San Francisco companies get implemented," Nick Slonek, principal and managing director at Avison Young, tells GlobeSt.com. "While some sizable sublease and direct transactions are getting completed—Chime, CBS Interactive, Apple and Yelp, to name a few—it does not appear that vacancy will dip below current levels until early 2022."

In addition to stagnant demand, San Francisco also had one of the largest sublease markets in the country during the pandemic. At the end of the second quarter, the city had 9.2 million square feet of sublease supply. Thankfully, some large users have started taking space back. "Some are pulling their sublease space off the market—including Adroll, Wish, Clarify Health and Keep Truckin—with forthcoming RTW plans; however, others such as Airbnb and Coinbase are putting more space on the market," says Slonek. "The high amount of sublease space all trends back to the vaccination success and RTW strategies.  With the Delta variant, this is a very fluid time for tenants.  Facebook, Google and other major tech firms have pushed their RTW plans to 2022."