Tech IPOs to Bring Newfound Wealth to Homebuyers
Uber, Lyft, Slack, Pinterest and Postmates have filed upcoming IPO offerings that will give thousands of San Francisco employees newfound wealth to perhaps purchase new homes.
SAN FRANCISCO—Just a few years ago, the Transbay District was predominantly parking lots and obsolete industrial buildings. Today, it is home to more than 10,000 new residents.
With companies such as Salesforce, Google, Facebook, Dropbox, Amazon and Uber recently leasing large blocks of space in SoMa and the surrounding areas, the housing market in the Transbay district is besieged by increased demand from thousands of employees looking to live closer to work. And, a number of San Francisco-based tech companies including Uber, Lyft, Slack, Pinterest and Postmates have filed upcoming IPO offerings that will give thousands of San Francisco employees newfound wealth to perhaps purchase new homes.
According to a recent CBRE report, 66,000 new tech jobs have been created in San Francisco since 2009; an increase of 270%. Since 2015, San Francisco office space leased to tech firms has increased by 8.6 million square feet, including 1.2 million square feet of space in SoMa leased by Facebook last year. Tech firms now occupy 38% of total occupied office inventory in San Francisco, 82% of which is located in SoMa alone.
It is no surprise then, that downtown San Francisco now has the lowest office vacancy rate in the nation at slightly more than 4%. This can largely be attributed to the fact that approximately 70% of all Bay Area office space has been leased by tech tenants in the past two years.
MIRA, the newest high-rise community in the Transbay neighborhood, is located within a small radius of many of these employers. Its proximity has resulted in a number of those tech professionals becoming MIRA residents.
“With tech company demand for downtown San Francisco office space as high as ever, it’s clear that there will be many young professionals looking to own a home close to their work in the coming months and years,” Carl Shannon, senior managing director at Tishman Speyer, tells GlobeSt.com. “We’re excited to have the opportunity to help shape this new neighborhood forming in the Transbay District for the better by bringing new homes to market with MIRA. This area was once a no man’s land filled with vacant lots. It’s now brimming with life and continues to grow into a desirable, amenity-rich community with plenty to offer.”
Located one block from the Embarcadero, Tishman Speyer’s latest project is a 40-story tower with large bay windows for Bay, Bay Bridge and city skyline views. Occupancy is slated for late 2019.
“We have tried to do our part to keep up with San Francisco’s housing crisis by developing nearly 1,700 new housing units in the Transbay District over the last 10 years,” says Shannon. “In our last project, Lumina, more than half of our buyers were under 40 years old. We have focused on attracting this new tenant mix by incorporating first-floor retail into all of our projects, including the district’s first full-service market, a fine dining restaurant and other well-rounded store front offerings. Our ultimate goal is to contribute to building a vibrant neighborhood that appeals to all new residents.”