Coherence

Economic Recovery?

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 18 May 2009 14:46:45 -0500

There are signs of life in the Bay Area economy. - That is what an article in the SF Business Times is saying this week. It is true that there is good news around if you are looking for it. Does this indicate simply a short-lived uptick in the economy (there were several during the Great Depression) or a real recovery? Residential Real Estate is starting to move a bit more. However, Commercial Real Estate sales are slower than ever from what I’m seeing. Further concerning is the number of commercial buildings that are hanging on the edge of foreclosure. If they start to go, we will see a second round of pain for banks and more economic stagnation. My hope is that we are truly coming out of this dark economic season… but let’s not be naive about the reality we face.

Charles Schwab sublease space in SF

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 09 Mar 2009 18:34:00 -0500

Chuck is cutting back its space usage here in San Francisco. Apparently with all of the economic woes they are trying to tighten their belts. They will still have more than 600,000 sf in the Financial District after they sublease all of their 375,000 sf at One Montgomery. The commercial office market is being flooded by sublease space every day, which is driving down rental rates. This is yet another sign that this is the golden moment for tenants. Don't miss out!

Newsome's Plan to Stimulate the SF Economy

Ryan Jones (TRI Commercial Real Estate Services) — Wed, 11 Feb 2009 18:52:59 -0600

Mayor Newsome announced a stimulus plan for San Francisco in order to jumpstart the local stagnant economy. This comes on the heals of the Federal bailout plan that Obama, the Senate and the House are finalizing details on. The local plan will focus on items such as eliminating payroll tax for companies looking to hire as an incentive to businesses to expand. This will help address the unemployment rate that has shot up from 4.4 percent a year ago to approximately 6.6 percent (as of December). For more about Newsome's plan, please click here.

more bad news... Hope?

Ryan Jones (TRI Commercial Real Estate Services) — Thu, 15 Jan 2009 13:05:07 -0600

It seems that the vortex formerly known as our economy is sucking even more jobs, houses, companies, and entire industries into oblivion. Today news sources talked about Motorola laying off 4,000 jobs, Autodesk laying off 750 jobs, major banks back begging in Washington, Foreclosures increasing, Apple stock taking a major nosedive on news of Steve Jobs taking medical leave, etc., etc. When will it ever end? It is increasingly clear that things will not be business as usual in many sectors of the economy at the end of this cycle. This isn’t just a hiccup, this is time for major reconstruction of entire industries and the obsolescence of others. Whenever there is a major shakeup like what we see now, it means there is enormous opportunity for creativity and ingenuity. I’m anticipating that we are headed into a new chapter in the history of capitalism. This isn’t all bad… in fact it could be very good. It depends a lot on our attitude and ability to be nimble and flexible. This is a time to check your gut and base your life on something more than financial success. (A good idea all of the time).

www.officespacesf.com

San Francisco Vacancy Rates Increase

Ryan Jones (TRI Commercial Real Estate Services) — Thu, 08 Jan 2009 12:54:03 -0600

New statistics coming out for the fourth quarter of 2008 show what we all have been seeing and feeling: vacancy rates are increasing pretty rapidly. In fact a new report says that the downtown financial district vacancy rate currently stands at just over 18%. (Read the article about the report here.) This is significant in terms of understanding how rental rates are affected. With supply increased, demand is lowered - putting downward pressure on asking rates. In some cases rates are dropping fast enough that counteroffers from the tenant are actually coming back lower than initial offers. This all goes to say that it is a great time to be a tenant in the marketplace.

www.OfficeSpaceSF.com

Happy New Year... With Hope

Ryan Jones (TRI Commercial Real Estate Services) — Fri, 02 Jan 2009 12:28:04 -0600

So much went wrong last year with the economy. Many are cautiously hopeful that 2009 will be a better year. The stock market (as of my writing) is up 1.75% today marking a two week high in spite of terrible retail numbers from one of the worst Christmas shopping seasons on record. Additionally, new jobless claims have dropped (see article). Many are hopeful that with less than 3 weeks left of the George Bush regime that things will change with the new administration. The truth is that this recession will be over as soon as people decide that it is over. The key is consumer confidence. Once the collective masses decide to start expanding business, start taking risks, and start to trust each other things will pick up quickly. My own guess is that this won’t happen until the end of 2009.

May God be with you in 2009! Happy New Year!!!

www.officespaceSF.com

Fewer Transactions... Nervous Landlords

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 29 Dec 2008 14:31:54 -0600

Commercial Real Estate Brokers are quite aware of how few transactions are occurring in the current marketplace. We feel it in our own pocketbooks. As much as it hurts brokers financially, it may be that we are coming into an extraordinary situation. What is happening in the commercial leasing market right now is setting up some incredible opportunities for tenants. There are very nervous landlords in any direction you throw a stone in San Francisco and the entire Bay Area. Nervous landlords means an edge up in negotiations for tenants. This means better rental rates, more concessions like free rent or tenant improvements, and lots of other perks for tenants.

While it seems counter-intuitive to expand or to step out and take a risk to secure space in this economy, it might be a recipe for success for a business with a solid strategy and a growing market share. Check out this article from SF Business times for more about office space.

www.officespaceSF.com

Commercial Buildings Heading Towards Foreclosure

Ryan Jones (TRI Commercial Real Estate Services) — Thu, 18 Dec 2008 15:20:11 -0600

The New York Times has a very interesting and important article regarding what is happening on the commercial side of the foreclosure crisis. Check out this link: NYTIMES ARTICLE

Office Space San Francisco

Class A Rates Keep Tumbling in San Francisco

Ryan Jones (TRI Commercial Real Estate Services) — Wed, 17 Dec 2008 15:54:05 -0600

Being a broker in this current economy keeps me on my toes. Office lease rates are moving pretty quickly (down that is). In some cases, rates have dropped quickly enough that tenants will start negotiations at one price and then come back with a lower number as they hear of other deals that come to light demonstrating more savings to be had. We have seen significant reductions in all Class A rates. Where buildings used to be asking rates in the 50’s - 60’s, they are now asking in the low to mid 40’s (or lower in some cases). It is not difficult to find Class A buildings offering mid 30’s and taking low 30’s deals.

What does all of this mean? It means that tenants have the chance to make a hay day of savings in some sweet spaces. I wouldn’t be surprised to see the rates slip quite a bit more over the next 6-9 months. Landlords beware… don’t trail the market down with your asking rates. You will be better off to be agressive and get a tenant locked into what appears to them to be a great deal (before the floor slips a little lower and tenants demand more).

San Francisco Free Wi-Fi?

Ryan Jones (TRI Commercial Real Estate Services) — Tue, 16 Dec 2008 13:23:01 -0600

It became public knowledge a few years ago that there was a movement to get free public Wi-Fi all over San Francisco. Apparently EarthLink and Google both tried to make it a reality. However, there were many snags having to do with financing and city politics that derailed both attempts. A local company called Meraki has continued the battle, but with a different approach. Currently there are portions of the city that are covered by this free public network. It is unclear if or when the entire city will be covered. For an interesting article about free public wi-fi attempts, check out this article in the Wall Street Journal. Also, check out this article about Meraki's recently developed solar powered technology meant to extend free public WiFi.

Office Space San Francisco

Retail Update

Ryan Jones (TRI Commercial Real Estate Services) — Thu, 11 Dec 2008 13:15:42 -0600

There is new information out regarding the state of the retail market. Unfortunately for everyone, the news is not encouraging… and neither are the projections for 2009. However, the truth is that people still buy even in the worst of economies. Being strategic and making the most of one’s business model can pull a business through. I think this business below could hardly fail! Here is the article with the report.

Office Space San Francisco

Development Continuing

Ryan Jones (TRI Commercial Real Estate Services) — Tue, 09 Dec 2008 18:32:14 -0600

In San Francisco, many (if not all) of the residential and commercial developments that have been in the pipeline are completely stalled out due to the condition of the economy and the lack of demand. However, there are still some projects that are so lucrative that even a failed economy can't stop them. One of those projects is the new Transbay Terminal project. If you want to read an interesting article about its progress, click here.

Good News, Bad News

Ryan Jones (TRI Commercial Real Estate Services) — Thu, 04 Dec 2008 16:27:05 -0600

First the bad news... AT&T is cutting 12,000 jobs (4% of its work force). See Business Times Article. This is going to further hurt our economy - where more and more jobs seem to be disappearing each day. However, It isn't bad news across the board. Several local San Francisco based companies are doing quite well. Del Monte and Salesforce are still cranking out the $$. See Business Times Article for Del Monte and Salesforce. This is great news for the local economy.

Mission Bay (San Francisco) Update

Ryan Jones (TRI Commercial Real Estate Services) — Tue, 02 Dec 2008 11:59:49 -0600

John King wrote an article in the San Francisco Chronicle that I think is helpful for understanding what is going on in the Mission Bay redevelopment zone. As you walk through the area, it is easy to notice both the newness of the buildings and construction, but also the fact that there are still large tracts of land that are sitting empty. What is happening with that? The Mission Bay area has still not reached its maturity and completion. But it is on the right track. Check out the article: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/12/02/DDUV14E03A.DTL&type=business

How Tenant Representation Works

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 01 Dec 2008 12:49:21 -0600

I hate to be taken advantage of. Thus, I am a person who is always leery of scams or bait and switch schemes. Because I am this way, I regularly identify these tendencies in othes who are equally leery. This comes up often when people talk to me about finding a space to lease. They want to know, "how much will your services cost me?" I inevitably launch into an explanation about how my services cost the tenant nothing because the landlord compensates me for bringing a tenant to his / her space. However, the suspicious side of the person I am explaining this to often feels this is too good to be true. I'm here to tell you that being represented by a broker in order to find space for your office and business is truly FREE. It costs you nothing out of pocket. In fact, it actually saves you money. Without representation, tenants often get taken advantage of by greedy landlords or corrupt landlord representative brokers. A good tenant representative can negotiate a better deal for the tenant than she could negotiate on her own. This is another reason why a person should use a broker. Finally, a broker has accss to all of the currently available spaces that are often located in databases not accessible to the general public without a paid subscription. It is well worth having access to all the options. All of this ought to be good news to tenants looking for an office space or a retail space.

visit San Francisco Office Space for more information.

Financial Market Update

Ryan Jones (TRI Commercial Real Estate Services) — Wed, 19 Nov 2008 16:10:23 -0600

I was privileged to have the opportunity yesterday to hear Liz Ann Sonders who is the Senior Vice President and Chief Investment Strategist at Charles Schwab. Here are a few nuggets from what she said that I found interesting.

- The dollar has strengthend rapidly over the course of the last month or so. Historically there is some substance to the idea that there is a reverse correlation between the strength of the stock market and the strength of the dollar. There is also a relationship between the strenth of the dollar and the strength of commodities. When the commodities market crashed, the dollar strenthened.

- When you look at the real estate market, it is interesting to note "real" mortgage rates. Over the course of the "boom", properties were increasing at perhaps 17% a year over a 5 year period. Meanwhile mortgage rates were 6%. That is an effective rate of +11%. Right now properties are going down by 10% and when you add a morgage rate of 6% to that is -16%. Why would a bank loan on that property?

- The real issue with real estate is the levels of inventory. Once inventory depletes, things will stabilize and lending will resume.

- About 30-40% of Hedge funds have cashed out and closed up shop.

- With regard to the automakers, they are currently set up to produce 16 million cars a year. There is only demand for 11 million. This is not going to be resolved with a 25 billion dollar bailout. There are serious issues here.

Encouraging signs:

- The US financial institutions have done more to deleverage themselves over the past 14 weeks than Japan did over 14 years with their similar financial collapse.

- Americans are moving aggressively towards a more frugal approach to finances. Personal debt is going down. There has been a 4% drop in private debt as a percentage of GDP in recent months. This is a good sign

- Liz Ann Sonders believes that Hank Paulson and Ben Bernake are doing the right thing. Their recent change of approach seems wise.

- LIz Ann Sonders expressed shock at the revelation that Greenspan wasn't aware of how deeply imbedded greed was in Wall Street. As she says, "I think fear and greed drive everything."

- LIz Ann Sonders thinks we are beyond the 50 yard marker in terms of the financial systems deleveraging.

- The economy will turn around when the confidence returns. This will change the housing inventory and will see cash infusions into the financial sectors. Liz Ann Sonders believes that the US is in a much better position than most of the world. There will be a world-wise recession that will last a total of about 16 months - we are already partly through this time. She thinks the upswing will start in June / July of 2009.

Emerging Trends 2009

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 17 Nov 2008 14:41:59 -0600

just read an article that I think will be helpful for consumers and professionals alike. It is honest, concise and informative. Basically, it appears that this article is a summary of the extensive report created by Price-WaterhouseCoopers called “Emerging Trends in Real Estate 2009″

Here is the link: http://www.compropguide.com/specialreport_08.html

Websites I Find Useful

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 17 Nov 2008 13:06:58 -0600

There are literally hundreds of millions of websites accessible in hundreds of languages to the 6 billion plus people on our planet. Of those numerous options, I basically move between a few that I find most interesting and helpful. Here are some of my favorites (not in any particular order):

1) Google - between Gmail, Google Maps (with street view!), Google search, Google analytics, Google Knol, etc., they have made my world a better place.

2) The Daily Beast - A concise and fun way to read the news

3) TechCrunch - Blog that keeps the tech headlines coming

4) Craigslist - for selling and buying and everything else

5) NBA.com - I'm a basketball addict I guess

6) Weather.com - I know when to bring an umbrella

7) Yahoo Finance - For more bad news about the stock market

8) Huffington Post - Unapologetically biased but entertaining

9) www.ThomasLFriedman.com - NY Times Op Ed columnist who I think is pretty sharp

10) www.OfficeSpaceSF.com - Ok, so its my website (and this is a cheap advertisement)

11) SFGate.com - Chronicle website... for local news

12) Real Clear Politics - Has the combined polling for election / politics issues. Was great for election season

13) Economist / BBC - Both of these give a more world centric news perspective

I guess that is it for now. There are other sites I visit, but these are the most common. Check them out!

Power of Humor

Ryan Jones (TRI Commercial Real Estate Services) — Thu, 13 Nov 2008 16:17:36 -0600

In tough times things can get tense and relationships can be strained. In the midst of tension, it is often only humor that can break the power of fear or anger or anxiety. Humor acts as a ray of sunlight piercing through the darkness of the storm clouds. Marriage guru John Gottman has written extensively about the power of humor to heal relationships. We ought to pay more attention to humor! I have found that many of my closest friends are people who use humor often and who are just generally funny people. I hope that you are blessed with people like that in your life.

Here is something to provide you a ray of hope: http://www.collegehumor.com/article:1764710

Challenging Times Continue

Ryan Jones (TRI Commercial Real Estate Services) — Wed, 12 Nov 2008 13:17:29 -0600

Although San Francisco has one of the strongest local economies in the nation, it too is feeling the pain of the terrible economic season we are experiencing. News broke yesterday about layoffs at Current Media, Wired.com and Six Apart. Current Media laid off 30 people (but its not clear if they were all in the San Francisco office - which seems doubtful). For more information, see: http://sanfrancisco.bizjournals.com

Google & My Contribution To Their Website

Ryan Jones (TRI Commercial Real Estate Services) — Tue, 11 Nov 2008 17:53:34 -0600

Google has this relatively new internet website / application which is essentially their own version of Wikipedia but with some other twists. They call this site "Knol." While it has not apparently taken off as fast some thought it would, I have found it to be a pretty helpful / interesting site. I have posted a couple of "Knol's" myself now which are links below. Please take a look at the links and give me a good rating if you like what you read. (Thanks!)

Retail Space In San Francisco

How to Find Office Space in San Francisco

A Local Association with International Vision

Ryan Jones (TRI Commercial Real Estate Services) — Tue, 11 Nov 2008 15:52:01 -0600

Every once in a while I discover a jewel in our community that I feel the need to highlight. Today it is an organization that I stumbled across a few months back called, "The World Affairs Council of Northern California." This organization brings in fantastic speakers (200 times a year) for lectures and Q&A sessions. I have heard the ambassador from Afghanistan, the lead Iranian investigative journalist (a dissident who now lives in NY), and many other fantastic speakers in the last couple of months since I joined. The subject matter they cover is extremely broad, from politics to world events to philanthropy to economic development to religion and culture. The people who attend these events come from a broad cross section of society. The orgnanization offers a year long membership that costs $95 which if you make it to even 5 or 6 of their 200 lectures offered each year you have made it worth your money. Their website is www.itsyourworld.org

Values I Operate My Business With: Part II

Ryan Jones (TRI Commercial Real Estate Services) — Wed, 05 Nov 2008 12:48:39 -0600

Nimbleness (the ability to respond quickly)

This ought to be standard business practice for all real estate professionals. It is not. I have gotten calls back from brokers weeks after I left a message. I am still waiting for dozens of unanswered emails. The least a person can do is email to say, "I won't be able to get back to you with the answer you are looking for for a couple of weeks." I will rarely use an information form online when I want a question answered because I don't want to wait for 3 business days to get an answer. I will usually pick up the phone and try to get the answer immediately. I'm assuming you are similar. My promise to my clients is that if you email me, I will be back in touch with you within one business day (usually only a couple of hours). If you leave me a phone message, the same goes for that as well. I want to operate my business with nimbleness because I think that being responsive with communication is central and basic to good business relationships.

Contact me with any questions at 415.268.2206 or email: rsjones@tricommercial.com or visit my website: www.officespacesf.com

Space Suggestion: Good Showroom space in SF

Ryan Jones (TRI Commercial Real Estate Services) — Wed, 05 Nov 2008 12:38:19 -0600

A colleague of mine is listing a building that has 10,000 square feet of ground floor showroom space. The space is at 200 Kansas. It is located at the base of Potrero Hill in San Francisco. This is a great space for a great price. They are officially asking “$21 NNN” per square foot per year. Let me know if you or someone you know could be interested in this space (rsjones@tricommercial.com).

Values I Operate With (Part I): Integrity

Ryan Jones (TRI Commercial Real Estate Services) — Mon, 03 Nov 2008 13:42:55 -0600

As a person who cares deeply about business ethics, sometimes real estate can be a challenging industry to be associated with. People have done a double take at me when they find out that I have spent my entire educational career studying theology, philosophy, and ethics. "How can you be a real estate broker and still keep your integrity?" people ask. It's true that real estate professionals rate somewhere near used car salesman in terms of public trust. But is that the way it has to be? What if brokers were more known for talking people out of deals than for trying to coerce people into deals that would not be good for them? What if when a broker said, "I'll call you on Wednesday," he or she actually called on Wednesday? This doesn't sound like a whole lot to ask if you are asking me. I have publicly stated that I want to build a business based on a foundation of integrity. The temptation to secure a little extra $$ from a commission is sometimes strong (especially when business is slow). However, it is a foolish business practice in the short and long term. People discover that they have been coerced or lied to. Will they ever refer me business if this is how I treated them? Of course not. Operating with integrity just plain makes sense. I can sleep well at night and my businees will prosper.