The Monday Morning Real Estate Update — Monday, December 14th, 2020
Podcast Transcript of Never Too Late To The Game’s Monday Morning Real Estate Update, December 14, 2020.
San Francisco Comings and Goings
Rents have plummeted 35%. I don’t think we are anywhere near bottom yet.
Japantown is hanging by a thread. But let’s be clear, Covid-19 is the nail in the coffin and not by any means the sole cause for the impending demise of Japantown. Tenants already had their Common Area Maintenance Fees (CAM Fees) spiked 90% in 2019. It appears that the owners, 3D Investments and Kinokuniya, — have bigger plans.
SF Gate contacted 3D Investments for comment but they were ignored.
Meanwhile businesses in Chinatown are also struggling.
San Francisco’s only Olive Garden has closed permanently.
The Cliff House Restaurant is closed permanently
Oracle has announced that they are moving their headquarters to Austin and mentioned the new employee structure (remote work and office options).
Covid-19 gave companies the answer to two long-standing questions: could employees be trusted to work from home and would there be any change in productivity?
The answer has been a resounding yes and yes productivity has reportedly gone up, releasing employers from a plethora of expensive benefits and ultimately office space.
If there is any hesitation, it is the outstanding question of whether or not productivity will change post Covid-19, as social and recreational options return.
For San Francisco the question remains: has the city (or state) done enough to secure Federal assistance for small business, house the homeless, work with landlords?
The answer is No.
This past week I talked to a friend who manages 600 San Francisco apartments. He said he can’t even count the number of vacancies or of people who have just stopped paying rent. He also mentioned that many landlords (the smaller ones) are severely hurting.