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Market Report

San Francisco Multifamily Investment Forecast

2022 Outlook

San Francisco Moves Forward After Worst Downturn Since Dot-Com Recession

Apartment market continues long climb back from health crisis. San Francisco was the hardest-hit metro in the country following the onset of COVID-19. A combination of strict prevention measures, a high concentration of jobs that could be transitioned to remote work, and traditionally smaller apartments encouraged many of the area's tech employees to seek larger accommodations elsewhere. Some major tech firms in both San Francisco and the South Bay were initially slated to recall workers to offices late last year, though a rise in virus cases pushed those target dates into early 2022. Once these companies require more employees to visit offices at least part time, the overhang of empty Class A apartments will begin to diminish more quickly. Already tight conditions in Silicon Valley will also benefit the city and peninsula as spillover demand increases. Nonetheless, some headwinds will persist. San Francisco tech companies like Salesforce, Pinterest and Twitter have more readily adopted permanent remote work, so the percentage of returning staff will likely be lower than in San Jose. Additionally, the area's cautious approach to the health crisis could slow a reintroduction to tourism, which is vital to the local economy.

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