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SF Drops To #6 US City Leasing Office Space In The Tech Industry

Jamie Ferrell Jamie Ferrell

SF Drops To #6 US City Leasing Office Space In The Tech Industry

San Francisco has ranked #1 for the last 9 consecutive years. 

Forbes recently reported on a study by CBRE detailing the tech industry’s office leasing activity across the US. San Francisco has led the nation in terms of major tech leases for office space since 2013, but it finally dropped from #1 to #6 in 2020. 

The San Francisco Bay Area has apparently been ousted in favor of cities like Seattle, Manhattan, and Washington D.C. It’s clear that companies looked to lease space in more affordable office markets, and we all know that the Bay charges a premium for any and all types of buildings. 

[Screenshot from Forbes]

Individual leases weren’t publically available to view, but the study revealed that 2020 has really shaken things up in terms of which cities had more traffic in the technology sector. 

While CBRE could not identify the individual leases since most were done under NDA and many are CBRE clients), its analysis revealed some intriguing leasing trends. There were some notable differences in 2020 compared to years past.

Seattle came in #3 in 2019 but replaced San Francisco for the #1 spot in 2020, having 14 of the largest 100 leases in the country. That’s a total of 3.4 million square feet, or a 72% increase. Other new markets that rose into the top 10 were Atlanta, Austin and San Diego. 

Software and E-commerce constituted the majority of the office space leases.

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[Screenshot from Forbes]

“Many tech firms’ business expanded during the pandemic and they continued to hire employees, which over time will create a need for more office space even with greater amounts of remote work,” Colin Yasukochi, executive director of CBRE’s Tech Insights Center, told Forbes. “The pandemic has accelerated trends benefiting many of the largest tech firms, such as increased use of e-commerce, digital productivity tools, social media, search and streaming. This could set up a longer term growth story for the tech industry that will create real estate demand.”

Learn more about Forbes’ report here

 

[Featured Image: Photo by Jared Erondu on Unsplash]