ULIsf Residential Market Economic & Pipeline Update Paul Zeger, Principal
SEATTLE san francisco new york washington dc LOS ANGELES MIAMI
SAN FRANCISCO OAKLAND- EMERYVILLE SILICON VALLEY
YEAR-OVER-YEAR SALES, PRICE AND RENT GROWTH* SAN FRANCISCO CURRENT PERFORMANCE ANNUAL CHANGE Median Condominium Resale Price $825, +9.3% Condominium Resale Closings 78 +.4% Average Rent $3,56 +11.5% SILICON VALLEY CURRENT PERFORMANCE ANNUAL CHANGE Median Resale Price $533,444 +21.2% Resale Closings 972 +14.6% Average Rent $2,194 +1.1% OAKLAND / EMERYVILLE CURRENT PERFORMANCE ANNUAL CHANGE Median Resale Price $357, +31.7% Resale Closings 231 +1.% Average Rent $2,185 +6.7% *For three months ending in December 31, 213 compared to same period in 212 Source: SFARMLS, MLS Listings, EBRDI, Real Facts
YEAR-OVER-YEAR JOB GROWTH* SAN FRANCISCO TOTAL JOBS 213 NEW JOBS 213 ANNUAL CHANGE ALL JOBS 64,955 18,793 +3.2% Tech jobs 45,275 6,165 +15.8% SILICON VALLEY TOTAL JOBS 213 NEW JOBS 213 ANNUAL CHANGE ALL JOBS 1,276,871 36,699 +2.9% Tech jobs 138,638 11,12 +8.6% *Source: CBRE, EDD
HISTORICAL 3-YEAR MORTGAGE RATES Mortgage (3 Year Fixed) 19% 18% 17% 16% 15% 14% 13% 12% 11% 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % RATE IN 1981 18.5% CURRENT RATE 4.3% 198 1983 1986 1989 1992 1995 1998 21 24 27 21 213 Source: FRED Year
SAN FRANCISCO ACTIVE CONDOMINIUM INVENTORY 1,5 Number of Units Available New Construction Resales Total Units 1, 5 Source: SFARMLS, Polaris Pacific 29 21 211 212 213 Year
SAN FRANCISCO CONDOMINIUM MARKET - MONTHS OF REMAINING INVENTORY 14 12 1 Number of Months 8 6 MRI 2.2 MONTHS 4 2 28 29 21 211 212 213 Source: SFARMLS Year
SAN FRANCISCO HOUSING SUPPLY AND DEMAND 15, Number of Units New Housing Units Shortfall SHORTFALL OF 15,175 UNITS Total Units 1, 5, Source: CBRE, EDD, Polaris Pacific 211 212 213 214 215 Year
SAN FRANCISCO RENTS $3,2 SF OCCUPANCY RATES REMAINED AT AN AVERAGE OF 95% FROM Q4-11 AVERAGE RENT $3,56 $3, Rents $2,8 $2,6 $2,4 211 Q4 212 Q1 212 Q2 212 Q3 212 Q4 213 Q1 213 Q2 213 Q3 213 Q4 Source: Real Facts Quarter
SAN FRANCISCO CONDOMINIUM PRICES AND SALES 4 Resales Median Price PREVIOUS PEAK PRICE $762,5 PRICE, 8.2% OVER PEAK $9k $8k 3 $7k $6k $5k 2 $4k $3k 1 $2k $1k 24 25 26 27 28 29 21 211 212 213 $k Source: SFARMLS Year
SAN FRANCISCO ANNUAL MULTI-FAMILY COMPLETIONS 2,5 Apartments Condos PEAK CONDOS 2,69 PEAK APARTMENTS 1,848 Forecast 2, 1,5 Units 1, 5 24 25 26 27 28 29 21 212 213 214 215 Source: Polaris Pacific Year
SAN FRANCISCO FUTURE HOUSING SUPPLY BY DISTRICT CONDOMINIUMS UNDER CONSTRUCTION APARTMENTS UNDER CONSTRUCTION TOTAL NUMBER: 2,28 TOTAL NUMBER: 5,279 7 27 8 32 7 8 89 1 88 6 248 1 6 673 2 5 59 9 1,374 2 5 6 9 3,737 4 4 3 182 1 3 1 Map of Market Number of Units: (Source: Polaris Pacific) Map of Market Number of Units: (Source: Polaris Pacific) 3 1, 3 1,
After 2 years of double-digit rent growth, rents were flat in Q4-13 Condo prices experienced double-digit increases in all 3 markets Minimal new condominium inventory being delivered to the market and minimal apartment projects available to be converted to condominiums Huge surge in new apartment construction; minimal new condo construction
FOREIGN INVESTMENT IN THE BAY AREA BROOKLYN BASIN LUMINA 5 THOMAS MELLON Developer Tishman Speyer Developer Signature Dev Developer Apic Foreign Investor China Vanke Foreign Investor Zarsion HOldings Foreign Investor -- MARKET San francisco market oakland market san francisco Number of Units 656 Number of Units 3,1 Number of Units 5 MACRO TRENDS SAN FRANCISCO SILICON VALLEY OAKLAND/EMERYVILLE
SILICON VALLEY ACTIVE CONDOMINIUM INVENTORY Number of Units Available 2, New Construction Resales Total Units 1, Source: MLS Listings, Polaris Pacific 29 21 211 212 213 Year
SILICON VALLEY CONDOMINIUM MARKET - MONTHS OF REMAINING INVENTORY 12 1 Number of Months 8 6 4 MRI 1.8 MONTHS 2 28 29 21 211 212 213 Source: MLS Listings Year
SILICON VALLEY HOUSING SUPPLY AND DEMAND SHORTFALL OF 27,461 UNITS Number of Units New Housing Units 3, Shortfall Total Units 2, 1, Source: CBRE, EDD, Polaris Pacific 211 212 213 214 215 Year
SILICON VALLEY RENTS AVERAGE RENT $2,194 $2,2 $2, Rents $1,8 $1,6 SV OCCUPANCY RATES REMAINED AT AN AVERAGE OF 96% FROM Q4-11 $1,4 211 Q4 212 Q1 212 Q2 212 Q3 212 Q4 213 Q1 213 Q2 213 Q3 213 Q4 Source: Real Facts Quarter
SILICON VALLEY CONDOMINIUM PRICES AND SALES 7 6 Resales Median Price PRICE PEAK $587,5 IN JULY, 27 $533,444 IS 9.2% BELOW PEAK $7k $6k 5 $5k 4 $4k 3 $3k 2 $2k 1 $1k 24 25 26 27 28 29 21 211 212 213 $k Source: MLS Listings Year
SILICON VALLEY ANNUAL MULTI-FAMILY COMPLETIONS 9, 8, Apartments Condos PEAK APARTMENTS 8,85 Forecast 7, 6, Units 5, 4, 3, PEAK CONDOS 1,844 2, 1, 24 25 26 27 28 29 21 211 212 213 214 215 Source: Polaris Pacific Year
SILICON VALLEY FUTURE HOUSING SUPPLY BY DISTRICT CONDOMINIUMS UNDER CONSTRUCTION APARTMENTS UNDER CONSTRUCTION TOTAL NUMBER: 436 TOTAL NUMBER: 5,82 Brisbane, Daly City, South San Francisco, Pacifica, San Bruno, Millbrae Brisbane, Daly City, South San Francisco, Pacifica, San Bruno, Millbrae 54 1 Belmont, Burlingame, Redwood City, San Carlos, San Mateo 1 Belmont, Burlingame, Redwood City, San Carlos, San Mateo 645 2 Menlo Park, Palo Alto, Mountain View, Los Altos 48 2 Menlo Park, Palo Alto, Mountain View, Los Altos 15 San Jose 96 San Jose 4,72 Campbell, Cupertino, Santa Clara, Sunnyvale 292 3 4 5 Campbell, Cupertino, Santa Clara, Sunnyvale 881 3 4 5 Map of the Market Number of Units: (Source: Polaris Pacific) Map of the Market Number of Units: (Source: Polaris Pacific) 1, 3, 1, 3,
OAKLAND / EMERYVILLE ACTIVE CONDOMINIUM INVENTORY 1, Number of Units Available 75 New Construction Resales Total Units 5 25 Source: EBRDI, Polaris Pacific 29 21 211 212 213 Year
OAKLAND / EMERYVILLE MARKET - MONTHS OF REMAINING INVENTORY 2 15 Number of Months 1 MRI 2.1 MONTHS 5 28 29 21 211 212 213 Source: EBRDI Year
OAKLAND RENTS AVERAGE RENT $2,185 $2,2 $2, Rents $1,8 $1,6 OAKLAND OCCUPANCY RATES REMAINED AT AN AVERAGE OF 96% FROM Q4-11 $1,4 211 Q4 212 Q1 212 Q2 212 Q3 212 Q4 213 Q1 213 Q2 213 Q3 213 Q4 Source: Real Facts Quarter
OAKLAND / EMERYVILLE CONDOMINIUM PRICES AND SALES 1 Resales Median Price PRICE PEAK $445, IN JULY, 26 $357, IS 19.8% BELOW PEAK $4k 8 $3k 6 4 $2k 2 $1k 24 25 26 27 28 29 21 211 212 213 $k Source: EBRDI Year
OAKLAND / EMERYVILLE ANNUAL MULTI-FAMILY COMPLETIONS 2, Apartments Condos PEAK CONDOS 1,597 Forecast 1,5 Units 1, PEAK APARTMENTS 774 5 45 APARTMENTS CONVERTED TO CONDOS 24 25 26 27 28 29 21 211 212 213 214 215 Source: Polaris Pacific Year
OAKLAND / EMERYVILLE FUTURE HOUSING SUPPLY BY DISTRICT Emeryville CONDOMINIUMS UNDER CONSTRUCTION APARTMENTS UNDER CONSTRUCTION TOTAL NUMBER: TOTAL NUMBER: 461 Emeryville 369 Oakland Oakland 92 Map of the Market Number of Units: (Source: Polaris Pacific) Map of the Market Number of Units: (Source: Polaris Pacific) 3 1, 3 1,
FORECAST FOR 214 Market pressure intensified by continued job growth Increasing foreign investment in the Bay Area Historically low interest rates continue Lack of new condominium inventory
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