SAN FRANCISCO—“It’s a massive understatement to say that the Bay Area office market is on fire.” That is according to Adam Hooper, CEO and founder of RealCrowd, based in Palo Alto, CA, who recently chatted with GlobeSt.com in preparation for the upcoming RealShare Bay Area conference, where he will serve as a panelist on the creative office panel.
“We’re seeing huge transactions by corporate users—Google having spent over half a billion dollars to acquire office properties in the last two years alone—a massive demand pipeline with over 6 million square feet reportedly active in the market, and a venture capital funding environment that has hit its highest quarterly investment amount since Q2’01,” he says. “This is all driving the market in a very heated way, and doesn’t appear to be showing any signs of slowing down.”
But is it a bubble or is it sustainable? Hooper tells GlobeSt.com that “time will tell as always, but the Bay Area is definitely enjoying one of the most dynamic job growth markets in the country and the impact on the built environment will be long lasting.” The office space of prior generation companies is long gone, he says.
“Companies that are fueling this market want open, creative and collaborative office space,” Hooper explains. “As a result, the usage per person of office space has dropped substantially from only a few years ago, meaning more productivity—and revenues—can be squeezed into that same square footage and higher rents are easily absorbed.”