san francisco center for economic development

January 2014

Commercial Real Estate

  • Overall, average San Francisco commercial rental rates in Q4 2013 were $53.99, a 5.4 percent increase over Q4 2012. CBD Class A space North and South of Market averaged $56.71 at year-end.  Rental rates continue to increase as demand for quality office space remains strong.
  • 2013 was a record-breaking year for commercial rental transactions, with more than 7.2 million square feet leased, far surpassing a 10-year average of 5.8 million.
  • Vacancy rates in Q4 for Class A CBD North of Market space averaged 8.5 percent, while SOMA continued to be “hot,” with 7.5 percent Class A vacancy.
  • New construction and renovations are scheduled to deliver 1.4 million square feet in 2014 and 2.1 million square feet in 2015.

Source: Cushman & Wakefield

New 4-Star Hotel Project Coming to Mission Bay

According to the San Francisco Business Times, the first new ground-up hotel project in six years is slated for Block 1 at Mission Bay, on Channel Street between Third and Fourth.  Plans call for a 15-story, 250-room hotel to be built by SOMA Hotel, an affiliate of Stanford Hotels Group, which acquired the property from Strada Investment Group.  Completion is scheduled for late 2016.

Source: San Francisco Business Times

Home Prices Continue to Rise

Housing prices in the Bay Area continued to rise through the 4th Quarter of 2013. However, December sales volume in the Bay Area declined when compared with December of 2012, with the exception of San Mateo County where sales volume for the month increased by 18 percent.

  • DataQuick reports that for 14 consecutive months the Bay Area median home price has risen more than 20 percent on a year-over-year basis. Bay Area-wide, median prices were up 23.9 percent over the previous year.
  • Limited inventory has resulted in the slowest December for Bay Area home sales in six years.
  • San Francisco’s median home price remains the highest in the Bay Area, at $813,000; Solano, which experienced a 25 percent annualized increase, remains the lowest at $272,000. 

Source: DataQuick

Foreclosure Activity in the Bay Area Counties

Foreclosure activity in San Francisco and the Bay Area has decreased significantly in Q4 2013 compared to a year ago. Bay Area fourth quarter numbers were 2,358, compared to 5,399 in 2012, a 56.3 percent drop.

In good news for California at large, foreclosures statewide are at an eight-year low, the result of an improving economy, foreclosure prevention efforts and higher home prices.

Foreclosure Activity in Bay Area Counties (Quarterly & Year-Over-Year)

Source: CAL-EDD (California and San Francisco), BLS (U.S.)


  • San Francisco’s unemployment rate decreased to 4.8 percent in December, the third lowest among California’s 58 counties.
  • Marin, San Mateo and San Francisco continue with the lowest rates in the state.
  • Statewide numbers improved between November and December, settling at 7.9%.

Bay Area Unemployment Rate by County

(August - November, 2013, not seasonally adjusted)

Source: CAL-EDD

Source: PricewaterhouseCoopers/National Venture Capital Association MoneyTree™

San Francisco Venture Capital Q4 2013

The San Francisco Bay Area continues to receive the lion’s share of venture capital funding.

  • There was $8.4 billion invested in Q4.
  • California companies received $4.3 billion, accounting for 55 percent of the total invested in the U.S.
  • Bay Area companies received $3.2 billion, which accounts for 38 percent of the nation’s funding in Q4 2013.
  • Annual VC investment in the San Francisco Bay Area totaled $12.1 billion in 2013, a 6 percent increase over 2012.
  • In 2013, there were 1,247 deals struck in the Bay Area, an increase of 2 percent over the previous year.

Local Share of Venture Capital Funding

Source: DataQuick


  • SFO’s new Boarding Area E, the first phase of Terminal 3’s renovation, opens January 28, offering 10 gates that will accomodatie more than 50 arrivals and departures each day. The $138 million BAE project includes interactive displays, local dining and shopping, spacious waiting areas, sweeping views and children’s play areas. The next phase of the T3E project, estimated at $209 million, will encompass upgraded security checkpoints with up to 10 lanes, three new gates and expanded concessions. Full completion is estimated for July 2015.
  • New Service Additions:  United service to Indianapolis began January 7; Delta will offer six new daily flights to Seattle starting March 28; and United resumes daily service to Taipei on March 29.

Source: San Francisco International Airport: Update Winter 2014

“Top 10 Skills Needed for Effective Leadership”

Chief Executive magazine identifies the Top 10 Skills Needed For Effective Leadership, based on responses to their annual survey of world-class companies.

  • Adaptability to change
  • Strategic thinking
  • Integrity
  • Very good communicator
  • Being trustworthy and open
  • Vision
  • Develops and fosters diverse teams
  • Delegation
  • A positive mind-set
  • High self-awareness

Source: Chief Executive, (2014, January/February p.26)

Quickfacts is produced by the San Francisco Center for Economic Development (SFCED).
For more information, please contact:

Dennis Conaghan
Executive Director

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