Plus: Three newly-public biotech firms preleasing South San Francisco Lab Space
October 18, 2019 - Joint Venture Silicon Valley’s Institute for Regional Studies today released its third-quarter 2019 report on Silicon Valley commercial space. New data shows that year-to-date completions have already exceeded 2018 totals. With 13 million square feet of commercial space under construction, the numbers were only slightly lower than the 19-year high of the previous quarter and indicative of a resurgence of R&D development within the region.
Many developments were preleased at the time of delivery to tenants – particularly to maturing companies desiring a campus-style consolidation of employees.
“It’s interesting to see the three newly-public homegrown biotech companies that preleased space in South San Francisco and the trend toward companies consolidating their employees into more of a campus-style environment,” said Rachel Massaro, Vice President and Director of Research at the Silicon Valley Institute for Regional Studies. “These companies are maturing, doing it here, and establishing themselves as driving forces in the region’s economy.”
“Another trend of note in this quarter’s report is how progress on just one or two major developments – like CityView Plaza and Google’s downtown development plans – can affect overall rents and the expansion of other submarkets,” emphasized Massaro.
- More industrial space was completed than in any individual quarter over the past 21 years
- Year-to-date commercial space completions have surpassed 2018 totals
- Preleasing activity remains strong
- Despite numerous new developments hitting the market, the total amount of commercial space under construction remained high at 13 million square feet
- There was more R&D space under construction than at any other time in the past 19 years
- Industrial space vacancy rates increased significantly ¾ up 64% and reaching 4.6%; a four-year high
- Demand for office space near public transit remains high
- Office space asking rents continued an upward trend
- 64% of the 12.4 million square feet of new commercial office space under construction throughout the Bay Area is located in Silicon Valley
The report covers trends in commercial space within Silicon Valley, encompassing San Mateo and Santa Clara Counties and the Cities of Fremont and Newark.
For further reference:
To access Silicon Valley’s online data hub, visit www.SiliconValleyIndicators.org.
About the Silicon Valley Institute for Regional Studies
The Silicon Valley Institute for Regional Studies is the research arm of Joint Venture Silicon Valley, and is housed within the organization. The Institute provides research and analysis on a host of issues facing Silicon Valley’s economy and society. For more information, visit www.SiliconValleyIndicators.org.
About Joint Venture Silicon Valley
Established in 1993, Joint Venture provides analysis and action on issues affecting the Silicon Valley economy and quality of life. The organization brings together established and emerging leaders—from business, government, academia, labor and the broader community—to spotlight issues, launch projects and work toward innovative solutions. For more information, visit www.jointventure.org.
JLL is a leading professional services firm that specializes in real estate and investment management. A Fortune 500 company, JLL helps real estate owners, occupiers and investors achieve their business ambitions. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com/silicon-valley.