RESIDENTIAL REAL ESTATE DISRUPTION UNFOLDING!!! Airbnb's latest discussions: the good, the bad, and the ugly for residential tenants and buyers

It's reported that Airbnb is in discussions with some of the country's largest residential landlords and is considering partnering with them.

This could add a ton of inventory to the Airbnb platform which is great for people looking for a short term place to stay.  That's good news!

But what if you're in need of a long term rental apartment or house and the amount of inventory decreases and what's left is really expensive?  What if you're a current residential renter?  Will your options decrease?  Will renewing from year to year increase?  The answer is most likely, "Yes!"  This is a double dose of  bad news for residential renters.

Now for the ugly.  If residential tenants decide it's more advantageous to buy versus rent, then we will see more demand for available residential properties.  This is great news for sellers, lenders, mortgage brokers, and agents but horrible for buyers.

In a space-constrained region like the Bay Area, technology stands to disrupt the residential real estate market with huge implications on those who don't currently own their own place or aren't in a rent controlled property. 

Stay tuned!

Landlord Dealing with Tenant Bankruptcy?

This is a great article highlighting some of the items a landlord must keep abreast of should his or her commercial tenant file for bankruptcy.

We always recommend keeping close to a commercial real estate attorney so if anyone needs a list of referrals, please let me know.

Time to Zell - but what does this really mean?

San Zell has reportedly sold billions of dollars of real estate recently.

Does this mean he thinks we're at the top of the market?  He seems to have a solid track record.

But, if he's selling, this means someone is BUYING his assets - are they crazy?

Please ping me to get the answer!

The state of startups - how will commercial real estate be affected?

First Round Capital published an interesting report showing the future of many things under the sun in regards to startups.

It will be interesting to see how many tech firms begin subleasing surplus office space as their growth plans change.  Will San Francisco become too expensive?  Will decision making shift more to investors?

Only time will tell.  Please ping me if you wish to discuss further.

Nelson Rising's Economic Forecast, with mention of the impact on Commercial Real Estate

Many years ago, Nelson's company Catellus was a major advertising client of mine who spent a lot of money branding their Mission Bay development in San Francisco and he has gone on to be one of the State's most cutting edge developers.

Here is his economic forecast.  I agree with his assessments regarding growth - I too don't see a major slowdown but do expect some of those "dark clouds" reeling in some of the unbridled exuberance.

Do-It-Yourselfers. You think you're getting a savings but it's really costing you more. Let me explain.

I just read a SF Business Times article about Social Print Studio who tried to sublease their commercial space in San Francisco on Airbnb.  Unless this is just a ploy for attention or something else, they just committed violations on several different levels.

These do-it-yourselfers don't seem to have a commercial real estate broker and don't seem to have an attorney overseeing them as both would have advised them differently from day 1 which would have spared them the black eye of this mini scandal.

No competent commercial real estate broker would have advised this company to break zoning laws by signing a lease in this industrial building in the first place which is mistake #1.  Bringing a sublease to market without engaging aforementioned broker for advice was mistake #2.  The broker would have referred the client to their lease and saved them the embarrassment of all this.  Mistake #3 is living in the property - a big no-no per Planning.  Mistake #4 is using Airbnb.  Sheesh - this shows how clueless these business executives are and could have ALL BEEN AVOIDED.

Do yourself a favor and seek out the advice of your trusted commercial real estate broker, counsel, and accountant.  You may think you're saving a few bucks by handling you real estate, legal, and accounting matters yourself but in essence, you're costing your company, employees, and investors so much more.

The Twitter tax break - was/is worth it?

The SF Business Times is reporting here that the City just lost out on $34 million in taxes in the Twitter/MidMa tax zone. One car argue that creating this tax break  was essential in attracting tenants like Twitter and Zendesk to a challenging part of the City but some can argue otherwise.

The MidMa / Civic Center region benefits from 1. immediate access to BART and Muni public transportation along Market Street 2. buildings possessing large floor plates which are attractive to tech firms seeking spaces that can house as many employees on one floor as possible and 3. a central location still close to SOMA and Downtown and 4. one of the only places left for tech companies to locate in SF.

Where else would Twitter, Zendesk, and others have gone?  The Peninsula?  Oakland?  Possibly, but it's harder to attract talent to these regions.  The City is so desirable that these companies cannot afford to be anywhere else.

Maybe the loss of tax revenue afforded merchants, residential landlords and others upside but did the City make a mistake?

If demand for this type of office space, type of building, and location keep increasing, then we can look back on the tax break as somewhat of a mistake as the revitalization and lease-up would have occurred anyway, without the tax break.  Only time will tell.

Attention investors - if you are looking for tax advantages, long term upside, and relative stability, then read this regarding Triple Net investments

Please see this article from GlobeSt. that explains the pro's and con's of zero cash flow triple net investments.

See: http://www.globest.com/news/12_1189/orangecounty/retail/Whats-Driving-Interest-in-Zero-Cash-Flow-NNN-361342-1.html?ET=globest:e47493:830623a:&st=email&s=&cmp=gst:California_AM_20150908:editorial

Venture-backed tech firm sublease, San Francisco, plug & play opportunity with Bay views and oh…a ping pong table!

If you are looking for a high-end tech firm sublease in San Francisco, look no further!  This is a full floor at 201 Mission Street.

The space features a mix of offices, break rooms, conference rooms, a kitchenette / cafe, open areas, and more.

It is fully furnished making this a plug and play opportunity.

For more information, please contact me at mgedymin@tricommercial.com or feel free to view the flyer at https://drive.google.com/file/d/0B2t3moAZc2nyYVJmWEpXcjNQZkE/view?usp=sharing

Thanks!