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A San Francisco buyer paid $100.72 per square foot for a 121,133-sf industrial property just off U.S. Highway 36 in Broomfield.

Stockbridge Real Estate purchased 224 and 226 Commerce St. from Boulder-based Flagstaff Holdings-224 LLC. The price recorded with Broomfield County was $12.2 million.

The two buildings, 74,853 and 46,280 sf, were fully leased at the time of the sale; however, there are two upcoming lease expirations, according to CBRE, which is marketing those spaces.

CBRE Senior Vice President Jeremy Ballenger said, “224 and 226 Commerce St. are unique not just because of their Boulder-driven location but also because the buildings offer true small-bay space, which is increasingly difficult to find in metro Denver. Tenants also appreciate the functional design and features like ample clear heights, sprinklers, dock-high and drive-in loading.”

There are six tenants at the property, including Puregas, Stone Lighting and Spaceman USA.

Located on 7.6 acres just off 36 and Wadsworth Parkway, the buildings feature office spaces plus warehouse areas with 18- to 21-foot clear heights. Stockbridge is rebranding the property as Northwest Commerce Park and undertaking a capital improvement plan that will include painting the buildings.

According to CBRE, the northwest corridor industrial submarket experienced strong leasing activity, with positive absorption of more than 200,000 sf, in the second quarter.

“As Boulder’s rents have continued to climb and we’ve seen no new industrial construction in the market since 2014, many industrial tenants are relocating to the northwest corridor and seeking out properties like 224-226 Commerce St. There’s also organic growth within the greater northwest area, and the property allows companies to secure more competitive rents while maintaining access to the area’s outstanding labor pool,” said Jeremy Kroner, vice president with CBRE in Boulder.

Kroner, along with Ballenger and Tyler Carner of CBRE, is handling leasing. Ballenger, Carner and Jim Bolt, also of CBRE, represented the seller in the transaction.

Stockbridge Real Estate is a real estate investment management company that invests in all major real estate property types and across the risk spectrum, from value-add properties to core assets.

Article source: https://crej.com/news/bay-area-buyer-pays-12-2-million-for-broomfield-assets/

And now the biggest boom of all.

The Nasdaq has dropped 8% from its intraday high on October 1, and now the real estate industry in the San Francisco Bay Area has its collective eyes fixed on it because there is an uncanny dependency on tech stocks.

The cause-and-effect relationship between tech-stock prices and real estate in San Francisco is not perfectly agreed-upon. One thing is sure: when the Nasdaq surges for an extended period of time, office rents shoot sky-high, and when the Nasdaq plunges, office rents plunge along with it. But when it comes to home prices, it’s complicated, as they say.

We’ll start with the relationship between the Nasdaq and home prices as measured by the SP CoreLogic Case-Shiller Home Price Index for “San Francisco.” The Case-Shiller covers house prices (not condo prices) in the five Bay Area counties of San Francisco, San Mateo (northern part of Silicon Valley), Alameda and Contra Costa (both in the East Bay) and Marin (North Bay). This area is home to a lot of tech companies and near a lot of other tech companies in the South Bay.

The Nasdaq, now at 7,449, is up 46% from the crazy dotcom-bubble peak of March 2000 (5,132). Over the same period, house prices in the five-county Bay Area have surged 170%.

As a reminder for those who’ve graciously forgotten: The Nasdaq plunged 76% from that bubble peak to 1,192 by July 2002, and as measured from that low, has since soared 524%, but remains far behind the home-price increases.

This chart shows the monthly Nasdaq ranges (black) and the Case-Shiller index for “San Francisco.” The horizontal fat blue line depicts the starting point for both:

In the year 2000 and in early 2001, the Case-Shiller index soared 34%, still boosted by the Nasdaq gains of pre-March 2000 and the hope that the tech-stock collapse was just a regular sell-off. Also, the Case-Shiller, by the way it is designed, lags several months behind actual home price changes.

But by mid-2001, both headed south together, with the Case Shiller dropping 12% over the next 12 months.

By the end of 2002, the Greenspan Fed’s low interest rates started to inflate the San Francisco housing market with a vengeance. Tech stocks followed six months later.

From mid-2003 until October 2007, both surged: The Nasdaq 126%; the Case-Shiller 58%, but off a much larger base, and thus continued to run away from the Nasdaq.

At the end of 2007, both headed south together: the Nasdaq plunged 53%. The Case-Shiller plunged 30% from super-lofty highs.

The Nasdaq bottomed out in March 2009 and began to skyrocket, gaining 440% since then. The Case-Shiller began to skyrocket at the beginning of 2012, gaining over 100%, but from a much higher base.

There are other standouts from the chart:

• This – the Nasdaq being up 46% in 18 years – is in part what you get when you measure a volatile stock market from its bubble-peak: It just doesn’t do that well on that basis, and that’s why it is rarely measured that way.
• The housing market in the SF Bay Area has been totally crazy over the past 18 years: up 170%. Over the same period, inflation as measured by CPI rose 47%.
• The Nasdaq would have to surpass 13,700 to catch up with the Case-Shiller home price index for San Francisco.
• The Case-Shiller index only goes back to the year 2000. Hence the limits of this chart.

In terms of the Nasdaq and office rents in San Francisco, the picture is a lot clearer. Reza Musavi at the San Francisco office of Cushman Wakefield provided this chart showing the quarterly close of the Nasdaq and quarterly office asking rents per square foot per year in the City of San Francisco (not including the surrounding counties; click to enlarge):

The chart depicts overall asking rents for the city of San Francisco, from the super-high-dollar rents downtown to the somewhat less breathtakingly high rents in other areas of the city, across all classes of buildings. Turns out, San Francisco office asking-rents move in-near lockstep with the Nasdaq, but lag two or three quarters behind.

Since the chart goes back to 1993, it covers the mega-bubble leading up to 2000, the smaller office-rent bubble leading up to 2007, and the greatest-of-all bubbles currently underway. And real estate pros who’ve been through this know where this is going. Boom and bust, always in San Francisco.

It has finally happened – a line in the sand has been breached. Read…  How Will 6% Mortgage Rates Deal with Housing Bubble 2?  
 

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Article source: https://wolfstreet.com/2018/10/20/nasdaq-v-housing-bubble-office-rents-in-san-francisco-booms-busts/

SAN FRANCISCO (CBS/AP) — The Mega Millions numbers that could win an estimated $1 billion jackpot have been announced.

They are 15 23 53 65 70 and Mega Ball 7.

No one in California won the jackpot but one lucky lottery player bought a ticket at an Arco station in Morgan Hill matching five of six numbers.

The jackpot is the second-largest lottery prize in U.S. lottery history. Mega Millions says it may take an hour or two to determine if there is a winner.

The odds of winning are a miserable one in 302.5 million.

The prize has grown so large because no one has hit the jackpot since July 24, when a group in California won $543 million.

The $1 billion prize refers to the annuity option. Most winners opt for cash, which for Friday night’s drawing would be $565 million.

Officials say that if there isn’t a winner, the prize for Tuesday night’s drawing would be $1.6 billion, tying the largest U.S. lottery prize.

Let Us Know What You Would Do with a Billion-Dollar Lottery Jackpot on the KPIX Facebook Page

When asked what they would do with the instant fortune, those lining up for tickets dreamed of luxury homes in the Bay Area’s red-hot real estate market, vacation homes in Tahoe and Hawaii, helping family members and taking a trip around the world.

The single winner will take home a the cash lump of more than $548 million. The record payout would be the second largest — the largest was a Powerball drawing for $1.59 billion in January 2016. Three winners split that total.

The odds of winning are astronomical and there will plenty of competition — Mega Millions is played in California, 23 other states, plus Washington, D.C., and the U.S. Virgin Islands.

There was a Bay Area winner in Tuesday’s Mega Million game drawing. A 20-something employee in the Marina Safeway bakery department matched 5 of 6 numbers in the then $667 million Mega Millions jackpot worth $1.9 million.

No one in the nation matched all six numbers.

Still the $1.9 million win created quite a stir at the store where tickets are sold.

“We didn’t know at first so he was working maybe a good couple hours before someone told him to check his ticket,” store manager Lea Maxwell told reporters. “We were walking around, trying to find out if someone hadn’t shown up for work today. We were hoping it was one of our employees.”

When she did find out, Maxwell was overjoyed.

“I think I ran from the meat department all the way to the front lobby,” she said. “I believe I was screaming for joy. All of my employees started congregating around the customer service center to congratulate him.”

And how did the young employee respond?

“I think he was extremely nervous,” she said. “He didn’t know what to do, so we kind of gave him a little direction and some assistance to work his way over to claim his prize.”

© Copyright 2018 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report

Article source: https://sanfrancisco.cbslocal.com/2018/10/19/1-billion-prize-triggers-mega-millions-lottery-frenzy/

SAN JOSE (KPIX 5) – A welcome development for anyone renting in the hot Bay Area market: Rents are dropping slightly after years of steep increases.

Zillow, the online real estate firm, tracked median rents in August and September.

In San Jose, rents were down 0.9 percent compared to a year earlier. Meanwhile in San Francisco, rents dropped by 0.6 percent.

Renters in San Jose say the slight decrease is not enough to make up for years of sharp rent hikes, but they do hope it’s the start of a long-term trend.

•ALSO READ: Parents Slam Proposal To Move San Jose Schools For Affordable Teacher Housing

Striking Marriott hotel workers have put the high cost of housing at the forefront of their effort to increase wages with the slogan “one job should be enough.”

Frank Cave-Lacoste, union worker and a renter, told KPIX 5, “I pay $2,200 a month for a one bedroom apartment with my wife.”

He says like many renters in the Bay Area, he’s faced with tough choices.

“We think seriously about whether we can afford to have a family here in San Jose because of how much we pay in rent,” Cave-Lacoste said.

The 0.9 percent decrease in San Jose rents is small and translates to just a $30 a month savings.

It is the first drop in seven years.

•ALSO READ: Bay Area Housing Struggles Extend To Farm-Rich Salinas

“It means virtually nothing,” said Sandy Perry of the Affordable Housing Network.

Perry said the dip has to be viewed in the context of sky-high rent increases, to the tune of $300 more, every few years.

“If you’re paying over half your income in rent, it’s not going to solve your problem. Having a $30 decrease is not going to solve your problem,” Perry said.

The San Jose Housing Department, which also tracks rents citywide, says it indicates more of a levelling off than a significant price break.

•ALSO READ: RV ‘Landlords’ Renting To Homeless, Low-Income Workers In Silicon Valley

“Having a levelling off, were hoping can just create a little more stability for our community,” said Rachel VanderVeen of the housing department.

Could this be the first signs of a market reaction to the high number of people leaving the Bay Area?

“If enough people make those choices, then there would be less demand on the current housing we have,” VanderVeen said.

No one knows if this trend will continue. But housing advocates say the real long-term solution won’t happen until this region produces as many new housing units as it does jobs.

Article source: https://sanfrancisco.cbslocal.com/2018/10/19/bay-area-rents-dip-slightly-zillow/

Article source: http://www.northbaybusinessjournal.com/northbay/sonomacounty/8829671-181/housing-real-estate-napa-sonoma-marin