As of December 2023, San Francisco's office vacancy was at 36.2%. Avison Young's analysis suggests that this has peaked and is expected to drop below 35.0% by the end of 2025. Marking a turning point, this forecast hints at a positive shift in the city's office space dynamics.

Tenants preparing to vacate their leased spaces often take the initiative to list their properties on the market well in advance of their lease expiration, providing an early indication of future market availability. However, recent findings by Avison Young reveal that approximately one-third of spaces set to expire within the next two years have yet to be listed. This introduces a concept known as "shadow vacancy," wherein the future status of these spaces remains uncertain, and a substantial amount of unlisted space is anticipated to become vacant in the market.

In San Francisco, there is an impending expiration of office leases totaling an estimated 15.5 million square feet within the next two years. Approximately 41% this space has already been vacated or proactively marketed for lease, which is accounted for in the current total market vacancy rate. However, the fate of around 5.2 million square feet of lease expirations remains ambiguous; these are the tenants that have not had their space put on the market but have also not yet renewed their lease. Diving deeper into these leases may provide us an indication of the direction market vacancy will move in the future.