Office Growth Drives Housing Demand, Duh.

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Office Growth Drives Housing Demand, Duh.

March 8, 2020

It's generally fun to poke fun at EssEff politics, but this Election Day brought a rare instance of sanity out of EssEff voters. As the Chronicle reported

Also winning was Proposition E, which will limit the amount of office space San Francisco can allow each year if the city fails to build enough affordable housing, based on targets set by the state. The measure, which needed a simple majority to pass, was leading 54.54% to 45.46% — 130,736 to 108,983.

Prop. E was sponsored chiefly by Todco, an organization that operates and advocates for affordable housing in San Francisco, and its executive director, John Elberling. Jon Jacobo, Todco’s policy director, said in a statement that voters “have shifted the paradigm of San Francisco. They have declared that we prioritize affordable housing before office development, and that is now the new norm in San Francisco.”

This move won't be a panacea nor will its impact be felt immediately. In fact, a number of other crosswinds like the macro-economy, availability of leading edge skills, and the perception of quality of life in the Bay Area will all drive the influx or exodus of people. Over the course of the last 20 years of my professional career I hired, or attempted to hire, dozens of professionals and admin staff into the Bay Area. It's always been expensive and attractive, but re-balancing the availability of commercial space with residential space should help just a bit with the cost. One wonders why it took a Proposition to do this in SF and why it isn't happening in other hotbeds like Mountain View or RWC instead of the futile rent control measures?

Posted in County Issues, General, Local Real Estate, Planning, Rent Control

4 responses to “Office Growth Drives Housing Demand, Duh.”

BurittosNoches

March 10, 2020

Whats your opinion on this? Specifically about axing the housing portion of this project.
https://www.smdailyjournal.com/news/local/vision-shifting-for-former-burlingame-post-office-redevelopment/article_819de784-3e68-11ea-9189-cfe577fd5953
Joe

March 10, 2020

I’m of mixed opinion on the office/retail only. One the one hand the balance I note in the original post is not advanced this way, but on the other hand it may help the project to accomplish some key goals: preservation of some of the post office and addition of some entertainment space downtown that we BADLY need. It’s not like we haven’t already approved and/or built enough new housing in town to choke the streets and make the faucets run dry. Anson Apartments are shockingly huge and the Howard Ave building will be huge if it’s ever built.
There was a piece inn yesterday’s WSJ about start-ups that are working to get tech jobs to locate elsewhere:
San Francisco entrepreneur Madhu Chamarty got the idea for his latest startup from Amazon. com Inc.’s search for its second headquarters, which included finalists like Indianapolis, Pittsburgh and Columbus, Ohio.
For him, the search highlighted overlooked cities away from the coasts that had the talent pools to host tech companies. Early last year, he launched Beyond HQ, a startup that uses technology to find new homes for Silicon Valley firms looking to move inland.
“It’s not that magic only happens in San Francisco and New York,” he said.
Mr. Chamarty is part of a group of entrepreneurs working on spreading tech talent more evenly across the U.S. The goal is to attract funding and workers to places far from the large tech hubs in Silicon Valley, New York City, Boston or Seattle.
Five metropolitan areas—Boston, San Diego, San Francisco, Seattle and San Jose, Calif.—accounted for 90% of all U.S. high-tech job growth between 2005 and 2017, according to a recent study led by Rob Atkinson of the Information Technology and Innovation Foundation and Mark Muro of the Brookings Institution.
Patrick McKenna, a Silicon Valley entrepreneur, started the nonprofit One America Works in 2019 that provides similar services to Mr. Chamarty’s BeyondHQ. He says tech concentration in just a few cities has led to problems such as a lack of affordable housing and traffic congestion.
“You can’t keep moving everybody to Silicon Valley,” he said.
Yesi Merino

April 6, 2020

Wonderful article, thank you for sharing! Affordable housing should be first to building new office spaces.
resident

April 7, 2020

It doesn’t sound like the big boys plan to slow down at all.
https://www.sfchronicle.com/business/article/Good-news-for-Bay-Area-Tech-hiring-despite-the-15180808.php
“In order to deliver for the billions of people and millions of businesses who rely on us, we aim to hire 10,000 people across tech and product in 2020. We also remain committed to making critical hires across the business,” said Chloe Meyere, a Facebook spokeswoman.
The company has plans to build or expand offices in Burlingame, Fremont and Menlo Park. Construction has stopped temporarily under shelter-in-place orders, but growth is still planned.
“We continue to hire and have many open roles,” said a Google spokesman, who declined to disclose specific numbers. Google’s website lists more than 600 openings in the Bay Area. The company said in February it plans to spend $10 billion on offices and data centers.

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