A little less than a third of all commercial office space in San Francisco is vacant, according to some estimates. The combination of work from home and concerns about crime have come together to make the city one of the slowest to rebound from the pandemic.
But one commercial real estate developer believes that while downtown has hit rock bottom, now is the time to invest.
Cyrus Sanandaji is the principal at the firm Presidio Bay Ventures, which just acquired 60 Spear in downtown San Francisco for $40.9 million.
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The property had most recently been assessed at $121 million, but Sanandaji's firm got a large discount, in part, because the building is mostly empty.
That’s not out of the ordinary for downtown San Francisco, where a lot of office space is sitting unused.
“We’ve seen our vacancy rate rise pretty significantly over the last couple years,” said Colin Yasukochi, the executive director of the Tech Insight Center at CB Richard Ellis.
Yasukochi said there has been a return to office work in the city, but that it was too early to call the change a rebound.
Presidio Bay Ventures is banking on innovators returning to the area.
“They made decisions across the board to try this remote work,” said Sanandaji, “and now three years into this experiment, I think we’re hearing from all the major employers, all the major trend setters in that space — both from the operator’s side but also on the investment side — that it’s not working.”
The idea, for him, isn’t simply to be a landlord. Sanandaji also plans to build a rooftop lounge and restaurant.
When workers do return to the office, he believes the buildings they’re in should have spaces that invite them to stay. And, at night, they should be destinations for everyone else to enjoy.
But the city is still struggling with serious issues of homelessness, open air drug use, crime and blight.
Sanandaji said filling office spaces again will take more than just being innovative with building design. He’s part of a campaign to help counter what’s become known as San Francisco’s “doom loop” narrative.
“It’s a grassroots movement to try and re-frame San Francisco’s image,” he said.
The aim of the campaign is to invite people to share images of the city, beyond viral videos of crime or tent encampments.
It also invites people to become interested in the politics of San Franciscio to help solve some of the city’s problems.
