Despite strong employment growth, office market remains weak as workers continue to work remotely

In the third quarter 2022, leasing activity in the San Francisco office market was 1.0 million square feet (msf), a decline of 29% from just under 1.5 msf reported last quarter. However, it should be noted that Google's 295,330 sf sublease from Stripe at 510 Townsend Street in SOMA comprised over 28% of all leasing activity in the market indicating that the overall leasing slowdown seen at mi -year has persisted into the second half of the year. As mentioned previously, the pullback in leasing in the technology sector this year has added another headwind to any office market recovery which has struggled as many office workers have continued to work remotely. As a result, expect record high office availability to continue to increase through the end of the year and into 2023.

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