SFCED | San Francisco Center for Economic Development


Don’t Fret: 5 Reasons San Francisco Companies Are Dumping Office Space

The sizzling San Francisco office market may have gotten some cold water sprinkled on it, now that the amount of space for sublease has hit a five-year high. Some office market observers have said this could be a signal that the office market may be cooling off, possibly a leading indicator that technology companies are getting too ambitious with their space needs.

But real estate brokerages have sprung to the market’s defense, arguing that the sublease trend is a positive sign. Subleases loosen the market, which makes it healthier, and give startups in need of quick space the opportunity to stay in San Francisco, they say.

“Many landlords are unwilling to sign for less than seven years, so tech startups in particular are finding the sublease market to be a viable option,” a market report by the brokerage JLL said. JLL also pointed out sublease space is being gobbled up at a quick pace – staying on the market for just 94 days on average.

Read more: San Francisco Business Times Don’t fret: 5 reasons San Francisco companies are dumping office

Don't Fret 5 Reasons SF Companies