June / July 2015
Unemployment at Record Lows
The unemployment rate in California dropped to 6.2% in May, down from 7.2% during the same period last year. Unemployment in the Bay Area has remained consistently low, San Francisco’s unemployment tallied 3.5% in May, slightly higher than Marin and San Mateo. Elsewhere in California, notable countywide unemployment rates in May included Orange (4.2%), San Diego (4.9%), Los Angeles (7.3%) and Sacramento (5.8%).
Bay Area Unadjusted Unemployment Rates, April - May 2015
Historical Unemployment Rates: California, San Francisco, U.S.
Source: EDD, Monthly
Housing Prices Keep Climbing
According to CoreLogic DataQuick, a total of 8,030 new and resale houses and condos were sold in the nine-county Bay Area in May 2015—down 1% from 8,108 in April 2015 but up by 3.1% from 7,792 in May 2014. May 2015 home sales were the highest for the month of May since 2013. However, May 2015 home sales were 15.5% below the May average of 9,500 sales since 1988.
The median price paid for all homes sold in the Bay Area in May 2015 was $650,000; this is down 1.4%, from $659,000 in April 2015, and up 5% from $619,100 in May 2014. The Bay Area median sale price has risen year-over-year for 38 consecutive months, with the median sales price climbing toward its peak price of $665,000 in June and July 2007.
Accordng to CoreLogic, “Home prices continue to rise but the gains in most areas are significantly lower than this time last year“.
Bay Area Home Sales: Volume and Median Price
Source: DataQuick, http://www.corelogic.com/
San Francisco Residential Sales Statistics In May 2015
Source: 2015, http://www.rereport.com/
Commercial Real Estate Market Remains Strong
The Q2 commercial statistics are still being compiled, but rents continue their upward climb, and vacancies are low – seemingly everywhere. The future is heavily weighted toward tenants with a connection to the innovation economy. In fact, 59% of the Q1 6.1 million square feet of tenants in the market have some (direct or indirect) ties back to technology. One bump in the road for later this year – San Francisco is due to run up against the Prop M office development cap if all pending projects in the 2015 queue are approved.
Not surprisingly, asking rents continued to rise ever higher. The overall Citywide figure closed the first quarter at $62.29 per square foot (psf), up 2.3% from the fourth quarter and 12.8% higher than the $55.22 psf recorded one year ago. The North and South Financial submarkets continued to duke it out for the “highest asking rent” title. For the first quarter, North Financial took the lead with an overall figure of $64.97 psf, slightly higher than South Financial’s $64.43 psf. Six office buildings are due for completion in 2015, with five of them completely pre-leased.
The Big 6 tech companies continue to drive the market (Salesforce, LinkedIn, Uber, Google, Twitter, Dropbox), and in some cases taking more space than they need, and placing some back into the sublease market (shadow space). Stay tuned.
Source: Cushman & Wakefield, DTZ, SFCED
“California Competes Tax Credit“ Helps Local Companies
The California Competes Tax Credit is an income tax credit available to businesses that want to come to California or stay and grow local companies. Below are the San Francisco companies that were awarded a tax credit as of April 2015.
Source: California Competes Tax Credit
San Francisco Leads Bay Area in VC Investments
The US received $13 billion in venture capital in Q1 2015. California has 59% of that share with $8 billion and within that, the Bay area represented 75%, or $6 billion.
Growth and Innovation at SFO
SFO was ranked #1 for “Best Airport Staff in North America” by SkyTrax and took fourth place honors in the “Best Airports Worldwide (40 million to 50 million passengers)” and “Best Airports in North America” categories. SFO has welcomed new airline Copa Airlines with non-stop flights to Panama. Qantas Airlines will resume non-stop flights to Sydney, Australia, six times per week, beginning December 20th. According to Qantas, "San Francisco is now the most populated onward destination for Qantas customers." SFO also unveiled new automated passport kiosks at their Custom’s facility to expedite the entry process for eligible international arriving passengers, who can complete their process in approximately 90 seconds.
San Francisco by the Numbers
• #1 best big city for jobs in 2015
• #1 for top emerging internet of things
• #1 on the new Global Cities Outlook due to strength in innovation
• #2 of the top 20 bikeable cities
• #2 most walkable US city
• #3 most Innovative tech hub in the U.S
• #5 on the top 25 best global cities to live based on health, security, economy and infrastructure
Source: parkscore, forbes.com, technewstoday.com, economist.com, citylab.com, atkearney.com, forbes.com
San Francisco’s High FDI Ranking
San Francisco was ranked #2 as a major North American City of the Future by FDIintelligence.com.
California’s Exports 2015
The value of California’s merchandise export trade rebounded in April, edging up a nominal 2.1% from the same month last year. The state’s exports of goods to foreign markets in April totaled $14.39 billion, up from the $14.09 billion recorded in April 2014.
Mexico continued to rank as California’s single largest export destination during the latest three-month period, with the value of exports rising 14.4% from $5.94 billion to $6.79 billion.
Source: Beacon Economics
Contact the SFCED
QuickFacts is produced by the San Francisco Center for Economic Development, a 501(c)(3) non-profit division of the San Francisco Chamber of Commerce Foundation. For more information please visit www.sfced.org or contact us at our offices in downtown San Francisco.
For more information please contact:
235 Montgomery St., Ste. 760
San Francisco, CA 94104