Back to the Office for Tech Workers

[Coronita]

[quote=sdrealtor]The vacant office space in SD is predominantly downtown. Suburban office space is doing much better[/quote]

I’m guessing most of us don’t understand how commercial RE works…

It’s not a simple, well a lot more people are working from home, so offices must be closing or vacant….

Sounds to me that there are a lot more jobs here in SD now, whether it’s remote or not remote.

Which is why I don’t understand’s DZ’s facination with some companies are now asking people to return back to the office in San Diego thinking that will cause real estate to crash by itself….

If we did have job growth in SD and a good portion is in life sciences and biotech, then lot more people now earn a lot more in SD….since I don’t know too many biotech scientists that are paid peanuts ..

[sdrealtor]

San Diego’s Office Sector Outperforms Nearby Metros;
Tech-Related Expansions Fuel Recovery

Large-scale leases signal long-term confidence. Contrasting other Southern Califor-
nia markets, office vacancy in San Diego compressed by more than 100 basis points last

year. A bevy of 50,000-square-foot-plus commitments by life-science and tech firms was
largely to credit for the notable improvement in leasing velocity. Highlighting activity
in 2021, Apple inked six agreements for floorplans in UTC and Rancho Bernardo that
together totaled nearly 500,000 square feet. Additionally, medical device companies

Tandem Diabetes Care and Becton, Dickinson and Company agreed to occupy a com-
bined 400,000 square feet in Del Mar Heights. Expectations for office-using job creation

to outpace last year suggests other sizable commitments may await the metro in 2022. As
a result, submarkets outside of Downtown San Diego, where vacancy remains well above
20 percent, may see vacancy rates fall below their long-term averages as sparse deliveries
in these locales steer prospective tenants to existing properties.
Conversion and retenanting prospects support diverse buyer pool. Institutional and
private sales activity strengthened in San Diego last year, coinciding with the return of
positive absorption and greater pricing clarity. Sorrento Mesa and adjacent areas that

are hubs for life-science companies are attracting national investors seeking $20 mil-
lion-plus assets. These submarkets boast sizable inventories of high-end space; however,

larger Class B properties are accounting for the bulk of trades. Candidates for conversion
to lab or R&D space are coveted, as assets that have undergone similar repositioning are
swiftly securing high-profile biotech tenants. Private investors are active in the sub-$10
million space, targeting smaller Class C properties near Balboa Park and Interstate 8 that
have historically been occupied by professional services firms. Assets with upcoming
leasing expirations or notable vacancies are available at low-5 to mid-7 percent returns.

[Coronita]

Thanks for sending the report… So what a lot of us has been saying is true….San Diego has significant job growth in tech and life sciences… Not that I doubted it…

[The-Shoveler]

Speaking of getting back to the commute.

Who wants to bet me that new Gas money relief checks (helicopter money) or maybe some no-commute order are coming soon ?

Just kidding sort of.

[an]

[quote=Coronita]
I mean, let’s think about this. When that new MM 3Roots community started taking waitlists for new home buyers, there were 14k+ people on a waitlist for 200 homes, and that’s before they stopped taking additional people on the wait list….

https://www.sandiegouniontribune.com/business/story/2021-05-19/why-14-000-people-are-interested-in-these-200-new-san-diego-homes

Think about that… That’s a 70:1 ratio….
How bad does the real estate market have to get to knock off demand when it’s a 70:1 ratio[/quote]
When 3Roots first started, Lennar’s biggest model in Alta development started out at low $1m. Then when it gets more concrete, they say starting at $1.3m. Now, it’s going for $1.65m+. All in the span of 6 months. Now, the bigger question is, can you even get pick to buy the place.

[Anonymous]

$5 gas doesn’t even phase San Diegans. From what I’ve seen lately, rush hour traffic is near or at pre-covid levels already.

As far as alternate transportation, the Covid cycling boom appears to have fizzled out as expected. But that was all about recreational biking, not commuting.

[Anonymous]

Regarding commercial real estate, since we are focusing on Tech industry in this thread why don’t we watch Qualcomm as a barometer since they are the largest tech company in San Diego.

So what are their plans for bringing employees back to the office? Or if they are seriously going full remote on permanent basis, then they should be jettisoning a lot of their office space. Is this happening? Anyone know?

[The-Shoveler]

Not really about San Diegans, But not everyone’s a tech worker either so $5 or possibly $7 Gas would hurt at the margins,

But that besides my point, I Just say TPTB will not allow anything that leads to a recession IMO.

In fact I double dog dare TPTB to not ride to the rescue to prevent a recession.

TPTB I know your out there, do it prove me wrong!!

[Anonymous]

[quote=The-Shoveler]Not really about San Diegans, But not everyone’s a tech worker either so $5 or possibly $7 Gas would hurt at the margins,

But that besides my point, I Just say TPTB will not allow anything that leads to a recession IMO.

In fact I double dog dare TPTB to not ride to the rescue to prevent a recession.[/quote]

But how will they avoid it? The only way to avoid it is for Fed to continue printing. In that case gas could go to $10 a gallon, or $20? or who knows. At this point maybe my gold investments will finally pay off!

But really they need a crash, that’s the only way prices will calm down. Then no matter how bad the crash gets, the bankers will be guaranteed to be bailed out so why do they care if there is a crash? Then Fed just blows up another bubble.

I don’t understand why folks on here think a crash is such a bad thing from the perspective of Wall St. bankers and other elites who basically control the country. They win either way.

[The-Shoveler]

My point, no recession, no way to clear out the excesses.
They just keep growing

[Anonymous]

[quote=The-Shoveler]My point, no recession, no way to clear out the excesses.
They just keep growing[/quote]

So you think the Fed is going to keep expanding their balance sheet? That’s the only way the economy will keep growing. But with 7.5% inflation and $5 gas? Not what they are publicly saying right now but nothing would shock me. I heard Powell yesterday say that he doesn’t believe the balance sheet expansion (the 4+ trillion the Fed printed since Covid) is the cause of inflation. Do you think he really believes this? None of the clueless congressmen yesterday even questioned this claim.

[Coronita]

[quote=deadzone]Regarding commercial real estate, since we are focusing on Tech industry in this thread why don’t we watch Qualcomm as a barometer since they are the largest tech company in San Diego.

So what are their plans for bringing employees back to the office? Or if they are seriously going full remote on permanent basis, then they should be jettisoning a lot of their office space. Is this happening? Anyone know?[/quote]

It’s hybrid. 2-3 days at work, exceptions can be made. Qualcomm never had plans to go full remote…ever…

Again, you are arguing with yourself here in cirles. Not sure what you are trying to get at.

Are you saying because a bunch of Qualcomm people are going back to the office, the demand for real estate here will suddenly drop off?
If so, that makes no sense.

Whether Qualcomm is going back to the office or not doesn’t matter. Qualcomm is based here SD. so if people need to work in the office, they need a home here SD. If they were working remote, they still need a home here in SD. So how is Qualcomm being fully remote or hybrid or fully on office matter to the local SD housing market?

The only difference would be a employer not based here in San Diego allowing people to work anywhere.Like tenant that signed a 2 year lease. Both are in marketing and work remote. She has to show up every so often to either the satellite office in OldTown or meet quarterly in LA. But other tha that they will stay down here and send their kids to school on DelMarUnified for $5000/month for 2800 sqft versus previously spending $5000/month for a 2/2 apt in Culver City with Culver City schools…
So, there are some transplants.

And there’s a lot of job growth here in SD where new people have new high paid biotech/life sciences job..That also means people need housing.

So why does.a few large companies saying they are doing a hybrid model make a signficant difference in the SD housing demand?

There appears to be 3 different categories of people living and working here and the remote workers is only one of those 3.

BTW: hybird model works if the job is in LA or OC. If one only.needs.to show up for work 1-2 days, so.e people dont mind taking the coaster to OC for example. I had a patent attorney friend that did that years ago…

[The-Shoveler]

LOL just saw south park “city people”,

No offence SDR JTR it was definitely on topic for this thread

DZ its just my theory that no recessions are allowed after 2009 when the TPTB discovered helicopter money.

[sdrealtor]

[quote=Coronita][quote=deadzone]Regarding commercial real estate, since we are focusing on Tech industry in this thread why don’t we watch Qualcomm as a barometer since they are the largest tech company in San Diego.

So what are their plans for bringing employees back to the office? Or if they are seriously going full remote on permanent basis, then they should be jettisoning a lot of their office space. Is this happening? Anyone know?[/quote]

It’s hybrid. 2-3 days at work, exceptions can be made. Qualcomm never had plans to go full remote…ever…

Again, you are arguing with yourself here in cirles. Not sure what you are trying to get at.

Are you saying because a bunch of Qualcomm people are going back to the office, the demand for real estate here will suddenly drop off?
If so, that makes no sense.

Whether Qualcomm is going back to the office or not doesn’t matter. Qualcomm is based here SD. so if people need to work in the office, they need a home here SD. If they were working remote, they still need a home here in SD. So how is Qualcomm being fully remote or hybrid or fully on office matter to the local SD housing market?

The only difference would be a employer not based here in San Diego allowing people to work anywhere.Like tenant that signed a 2 year lease. Both are in marketing and work remote. She has to show up every so often to either the satellite office in OldTown or meet quarterly in LA. But other tha that they will stay down here and send their kids to school on DelMarUnified for $5000/month for 2800 sqft versus previously spending $5000/month for a 2/2 apt in Culver City with Culver City schools…
So, there are some transplants.

And there’s a lot of job growth here in SD where new people have new high paid biotech/life sciences job..That also means people need housing.

So why does.a few large companies saying they are doing a hybrid model make a signficant difference in the SD housing demand?

There appears to be 3 different categories of people living and working here and the remote workers is only one of those 3.

BTW: hybird model works if the job is in LA or OC. If one only.needs.to show up for work 1-2 days, so.e people dont mind taking the coaster to OC for example. I had a patent attorney friend that did that years ago…[/quote]

One of my good friends is full remote at QCOM. Has been for almost two years from east coast. When they initially said no, he said oh ok guess I’ll go find another job. He arranged that before COVID. He lived here over 20 years and wants to live other places. He’ll never move back and can stay there as long as he wants. He does visit his wine at my house every couple months

[Anonymous]

[quote=Coronita][quote=deadzone]Regarding commercial real estate, since we are focusing on Tech industry in this thread why don’t we watch Qualcomm as a barometer since they are the largest tech company in San Diego.

So what are their plans for bringing employees back to the office? Or if they are seriously going full remote on permanent basis, then they should be jettisoning a lot of their office space. Is this happening? Anyone know?[/quote]

It’s hybrid. 2-3 days at work, exceptions can be made. Qualcomm never had plans to go full remote…ever…

Again, you are arguing with yourself here in cirles. Not sure what you are trying to get at.

Are you saying because a bunch of Qualcomm people are going back to the office, the demand for real estate here will suddenly drop off?
If so, that makes no sense.

Whether Qualcomm is going back to the office or not doesn’t matter. Qualcomm is based here SD. so if people need to work in the office, they need a home here SD. If they were working remote, they still need a home here in SD. So how is Qualcomm being fully remote or hybrid or fully on office matter to the local SD housing market?

The only difference would be a employer not based here in San Diego allowing people to work anywhere.Like tenant that signed a 2 year lease. Both are in marketing and work remote. She has to show up every so often to either the satellite office in OldTown or meet quarterly in LA. But other tha that they will stay down here and send their kids to school on DelMarUnified for $5000/month for 2800 sqft versus previously spending $5000/month for a 2/2 apt in Culver City with Culver City schools…
So, there are some transplants.

And there’s a lot of job growth here in SD where new people have new high paid biotech/life sciences job..That also means people need housing.

So why does.a few large companies saying they are doing a hybrid model make a signficant difference in the SD housing demand?

There appears to be 3 different categories of people living and working here and the remote workers is only one of those 3.

BTW: hybird model works if the job is in LA or OC. If one only.needs.to show up for work 1-2 days, so.e people dont mind taking the coaster to OC for example. I had a patent attorney friend that did that years ago…[/quote]

The only one going around in circles is you FLU. I’m just using Qualcomm as a representative large tech company that happens to be local so we can easily verify their happenings. You guys are the ones arguing that remote work is here stay, and nobody is going back to the office, blah blah blah. Well apparently that is not the case at Qualcomm, Amazon or Google and many, many more companies.

The point is there is not going to be another big wave of workers moving to San Diego or anywhere else to remote work. THat ship has already sailed.

[Author]

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