Dropbox handing over 25% of San Francisco HQ back to landlord as commercial real estate softens::San Francisco is seeing its highest office vacancy rate since at least 2007 as Dropbox and other companies allow employees to work from home
Dropbox handing over 25% of San Francisco HQ back to landlord as commercial real estate softens::San Francisco is seeing its highest office vacancy rate since at least 2007 as Dropbox and other companies allow employees to work from home
Commercial space is abundantly available which is why that market is soft. Residential listings is at historic lows and only slightly increasing. You’d need to see a massive swell of listings to see residential property values crash. Only way we’d see that is if rates get to where it makes sense for borrowers to trade in their 3% mortgages.
At some point, there will be more large-scale conversions of commercial space into residential with the market so lopsided. It’s already happening in some places
Most commercial projects physically cannot be converted. You’d have to strip out the whole building and reconfigure it for plumbing and electrical to exist in smaller units (condos).
I’ve spoken to developers about this before (I’m a mortgage lender that works with builders) and for them, it’d be easier to demo some of these buildings and rebuild them as residential so it’d have all the amenities tenants want.