AI firms boost office leasing in San Francisco and Manhattan markets - report (SLG:NYSE)
Why this matters
Office continues to trade in two distinct markets: trophy assets in walkable submarkets that are leasing at or near record rents, and commodity Class B and C buildings where the basis is still resetting. Underwriting on the latter has moved toward replacement-cost-minus, with credit underwriting now leaning on tenant covenant and remaining lease term rather than mark-to-market expectations. San Francisco continues to clear office at the deepest discounts to 2019 basis seen in the cycle, while multifamily fundamentals have stabilized and life sciences in the Peninsula remains active. For LP-positioned capital, the read-through is that the bifurcation is now a structural feature of the sector, not a cycle to wait out.
Editorial analysis · Real Estate Trail Editorial
On the RET wire
- The 150th San Francisco story tracked on the wire in September 2026. All San Francisco coverage →
- Disclosed office deal value tracked in September 2026: $13.9B across 67 reported transactions. All Office coverage →
Computed from Real Estate Trail’s own tracked coverage
External link. Real Estate Trail does not republish source content.
Related coverage — San Francisco · Office
Hudson Pacific Sells 284,000 SQFT 875-899 Howard in San Francisco for $65.5MM
Hudson Pacific Properties has unloaded its two emptiest San Francisco office holdings for $65.5 million, entitling part of a vacant former Burlington Coat Factory building for office use before handing both properties…
The race is on for San Francisco's next big tower - San Francisco Business Times
California People and Company News, Week of Sept. 25, 2026
Colliers has added Grant Hyjer to its Oakland office, where he will specialize in industrial leasing, sales, and investment across the I-880 corridor and the broader East Bay as SVP. Hyjer brings over a decade of high…
Physical Intelligence Leases 233,500 SQFT in Mountain View Near Google’s HQ
Physical Intelligence leases 233,500 SQFT in Mountain View near Google, joining a robotics leasing wave reshaping Silicon Valley office demand. The post Physical Intelligence Leases 233,500 SQFT in Mountain View Near…
Zurich Affiliate Acquires San Francisco Offices with Leasing Upside
Cushman & Wakefield has arranged the sale of 410 Townsend, a historic 78,455-square-foot office building in downtown San Francisco. An affiliate of Zurich Alternative Asset Management purchased the building for $47.4…
Frontline Realty Capital Buys 43,498 SQFT Promenade Office Building in Berkeley at Steep Discount
San Francisco-based Frontline Realty Capital has bought its third distressed Bay Area office property in 18 months, betting that Berkeley’s tightly supplied office market will recover faster than the region’s more bat…