San Francisco, CA Economic Overview
The “City on the Bay" has it all: whether it’s restaurants and nightlife, culture and arts, education or professional sports, the city ranks among the best in the country. What’s more, there’s a strong economy and thriving San Francisco commercial real estate market to go along with it.
Since the California Gold Rush of the mid-19th century, San Francisco became a major player in the financial industry, with tourism as a close second. Because innovation has always been welcome here, the region also serves as one of the most important centers of technological breakthrough in the world.
With over 24 million visitors in 2015, San Francisco is a major tourist destination, easily accessible through San Francisco International Airport, which boasts the largest international terminal in the United States. The city’s strong finance, healthcare, hospitality, retail, and education sectors also contribute to the bustling San Francisco commercial real estate market.
San Francisco, CA Commercial Real Estate Market
Stretched out over 47.9 square miles, San Francisco is home to over 78 million square feet of office space. The market is expanding rapidly, with another 5.1 million square feet currently under construction.
Financial District, San Francisco, which is split into the North and South Financial District, is the center of San Francisco’s economy. The Financial District office market encompases over 50 million square feet, which is more than 65% of the city’s total space, and is home to all six of the city’s Fortune 500 companies, including Wells Fargo, PG&E, Gap, and Salesforce.com.
South of Market, San Francisco, also known as “ SoMa", is the second-largest office market in the city, with nearly 8 million square feet of space. The SoMa office market is also the city’s tech hub, home to the headquarters for Airbnb, Dropbox, Pinterest, and more. SoMa includes Mid-Market, over 4.2 million square feet of office space along Market Street. Mid-Market’s rapid growth is led by tech firms like Twitter, Zendesk, Square, Uber, and Dolby.
Mission Bay, San Francisco is an important area for life sciences and biomedical research, home to the California Institute for Regenerative Medicine, the UCSF Mission Bay research campus, and several biotechnology firms. The Mission Bay office market encompasses over 1 million square feet of space and the area will soon welcome Chase Center, the Golden State Warriors’ new arena.
San Francisco, CA Office Rental Rates ($/SF/year)
Data provided by Yardi Matrix, for properties larger than 50K SF.
San Francisco, CA Office Sales
Data provided by Yardi Matrix, for properties larger than 50K SF, which sold at over $5M.
San Francisco, CA Commercial Inventory Breakdown
Total: 113,089,429 SF
By square footage range:
- 50k to 100k SF: 11,394,378 SF / 10.08% of total office
- 100k to 500k SF: 61,040,731 SF / 53.98% of total office
- 500k to 1M SF: 28,495,928 SF / 25.2% of total office
- > 1M SF: 12,158,392 SF / 10.75% of total office
- Class A+: 12,328,864 SF / 10.9% of total office
- Class A: 63,886,574 SF / 56.49% of total office
- Class B: 26,600,640 SF / 23.52% of total office
- Class C: 398,706 SF / 0.35% of total office
Total: 3,864,932 SF
By square footage range:
- 100k to 500k SF: 2,704,932 SF / 69.99% of total industrial
- > 1M SF: 1,160,000 SF / 30.01% of total industrial
- Class A: 248,534 SF / 6.43% of total industrial
- Class B: 1,322,558 SF / 34.22% of total industrial
- Class C: 580,370 SF / 15.02% of total industrial
Employment in San Francisco, CA
The San Francisco Bay Area may be best known for its high technology companies these days, but there are plenty of jobs in other industries. In fact, the economy here is quite diverse, with employment opportunities spread across several major sectors.
- Technology There are over 70,000 people employed in the technology sector within the city of San Francisco, which also serves as the headquarters for companies like Twitter, Uber, and Yelp. Salesforce.com is the city’s largest tech employer, with nearly 6,000 employees. Of course, there are also many San Francisco residents who work in nearby Silicon Valley, which has another 200,000+ tech jobs and is home to the likes of Google, Facebook, Apple, Intel, and HP;
- Tourism and Hospitality San Francisco’s $9-billion-dollar tourism industry is strengthened by its high-traffic international airport and its impressive culinary and nightlife scenes. The industry creates over 135,000 leisure and hospitality jobs, with roughly 75,000 of those jobs related specifically to tourism;
- Healthcare The thriving healthcare industry in San Francisco provides over 100,000 local jobs. Some of the biggest individual employers include the California Pacific Medical Center, Kaiser Permanente, and Dignity Health, which collectively employ over 13,000;
- Government There are over 127,000 government employees working in San Francisco, divided between the federal, state, and local government;
- Financial Services Wells Fargo is San Francisco’s largest private employer, with over 8,000 employees. Charles Schwab also has a strong presence, employing more than 2,000. Both of these Fortune 500 financial companies are headquartered in San Francisco;
- Retail San Francisco has over 70,000 retail jobs, with Gap being the largest single employer in the sector. The Fortune 500 clothing company is also headquartered here, along with Levi Strauss, Inc.
While education doesn’t quite make the list as one of the largest employment sectors, it is an important part of the local job landscape.
Education in San Francisco, CA
San Francisco has a rich educational tradition. The University of California, San Francisco is ranked among the five best medical schools in the country, and the University of California, Hastings College of the Law is the oldest law schools in the state. Then there’s the City College of San Francisco, one of the country’s largest two-year community colleges, and the Academy of Art Institute, the largest art and design institute in the U.S.
Notable institutes of higher learning in San Francisco also include San Francisco State University, the University of San Francisco, the San Francisco Art Institute, the San Francisco Conservatory of Music, and the California Culinary Academy.
The city’s many public schools fall under the San Francisco Unified School District.
Commuting Time in San Francisco, CA
When ranking U.S. cities by commute times, San Francisco comes in as sixth-worst. Roughly 35% of residents rely on public transportation, the second-highest rate in the country.
- The city’s most popular public transit system is the San Francisco Municipal Railway, which operates light rail/subway, bus, and cable cars. You can find out how to ride here: https://www.sfmta.com;
- Over 100,000 bicycle trips are made in San Francisco each day, and it’s also one of the most walkable cities in the U.S. You can find popular walking and biking routes here: http://www.sfbike.org/resources/maps-routes/.
San Francisco Demographics
- Total Population864,263
- Male Population(51.0 %) 440,633
- Female Population(49.0 %) 423,630
- Median Age38.30
- Average Household Income$137,761
- Median Household Income$96,265
- Median Income Under 25$50,275
- Median Income 25-44$131,754
- Median Income 45-64$93,774
- Median Income Over 65$44,839
Key takeaways: 682 million square feet of office space have been added across the country in the last 10 years. Campus-style tech companies greatly influenced the suburban expansion throughout the U.S. New York City, Chicago, and San Francisco grew the most on the fringes of the urban cores. The...
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