In the biggest decline since the dot-com crash in 2001, San Francisco office rents dropped 24% in the first quarter on a year-over-year basis.
The average rent fell citywide to $38.80 a square foot from $50.92 for the highest-quality, best-located space, known as Class A space, according to a preliminary report by commercial brokerage Colliers International. The office vacancy rate rose to 13.2 percent from 12.6 percent in the previous quarter and up from 10.2 percent a year earlier.
These numbers, as horrible as they may look, are actually good compared to the data out of Cushman and Wakefield presented yesterday indicating that first quarter Manhattan office rents fell the most in 25 years.
Colliers also said that commercial property purchases in San Francisco are “nearly non-existent” as surging defaults and reduced availability of debt curtail acquisitions. [via Bloomberg]