19m sf under development on SF Peninsula
Research - OCTOBER 26, 2017

19m sf under development on SF Peninsula

by Andrea Waitrovich

Currently, there are 11.7 million square feet of office development and 7.0 million square feet of research & development (R&D) space in the pipeline for San Mateo County in the San Francisco Bay Area, according to Colliers International.

While larger users continue to expand at exponential rates, smaller users are being priced out of the market and displaced. As a result, office users are forced to move further away from downtown core markets, R&D users must look for smaller, more divisible spaces within the biotech sector, and industrial users have nowhere to go with such a limited availability.

Both R&D and industrial vacancy rates are hovering at critically low levels due to the increasing demand and higher-end asking rates. The R&D biotech sector ended the quarter at a historically low vacancy rate of 1.22 percent with a $3.29 NNN asking rate, while the industrial sector ended with a 1.64 percent vacancy rate and a staggering $1.44 NNN asking rate. Even though smaller office users are being displaced, the overall office sector remains quite active with an overall 7.29 percent vacancy rate and a $5.07 asking rate. With all of this movement on the San Francisco Peninsula, tenants hope there will be more space coming soon.


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