Office availability rates continue their upswing despite new demand from generative A.l.

In the third quarter 2023, the total availability rate in the San Francisco office market increased by another 120 basis points (bps) from 35.1% reported last quarter to 36.3%. Record-high sublease space decreased slightly to 9.4 million square feet (msf), down from 9.8 msf reported last quarter, but up 21% from 7.7 msf reported a year ago. With return to office rates amongst the lowest nationally and occupier concerns about declining quality of life and safety, expect leasing activity to remain lower over the short-term, especially as the technology sector continues to right-size after years of growth.

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