San Francisco could become home to the nation’s most expensive office space by the end of next year, topping rents in New York for the first time since the peak of the tech bubble in 2000.
Average rent in San Francisco will hit $69.71, an increase of 18 percent, in the latter part of 2015, according to a new research report from CBRE cited by Bloomberg News. In the same period, CBRE expects Manhattan office rents to climb 6.5 percent to $69.68. San Francisco’s financial district already boasts pricier offices than New York’s Downtown submarket.
Since the end of the recession, technology companies have accounted for one out of every four office jobs in the United States. At the same time, more people are leaving offices than are moving into them in Manhattan, as sectors such as finance and insurance reduce their footprint, according to the New York Building Congress.
Leasing among technology, media, advertising and information companies accounted for 41 percent of new office jobs in New York City between 2011 and 2013, compared with 56 percent in San Francisco, according to the report. [Bloomberg News] – Tom DiChristopher