Rent-control expansion fails in Sacramento

San Franciscans swarm state capital to boost, decry rent-control law

Hundreds of San Francisco and Bay Area residents trekked to Sacramento Thursday morning, waiting in lines that stretched out of the State Capitol building, to tell the California State Assembly whether they oppose or support AB 1506, a bill that would give cities the opportunity to create new rent-controlled housing.

The bill ultimately failed to pass the Housing and Community Development Committee, falling one vote short of the necessary threshold to move forward. However, backers of the bill, which would repeal the 1995 Costa-Hawkins Act, promised to revive it.

Tenants groups like Alliance of Californians for Community Empowerment (ACCE) and the SF Tenants Union boarded buses before sunrise at Civic Center in order to make it to Sacramento for the 9 a.m. hearing. While lawmakers calmly listened inside, shouting matches broke out in the hallway outside as hundreds of Californians, both pro and con, waited their turn to speak.

Read more from Curbed SF

Apple announces second campus, promises to bring 20,000 jobs

Part of $350 billion U.S. investment, it may set off Amazon #HQ2-like scramble among cities

On the heels of the frenzied competition between cities for Amazon’s HQ2, Apple announced earlier todaythat it will also be building a second headquarters somewhere in the U.S.—setting off similar excitement among cities and local leaders.

According to a report in the Associated Press, Apple will be building a second headquarters over the next five years that will employ an estimated 20,000 workers, all part of a $350 billion commitment to the U.S. economy. The company plans to announce the location of the second headquarters by the end of the year.

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Proposed California rent control expansion returns

After nearly a year on the shelf, repeal of 1995 Costa-Hawkins Act to have first public hearing Thursday

In February of 2017, San Francisco Assemblymember David Chiu and two other California lawmakers introduced AB 1506, a bill that would repeal the 1995 Costa-Hawkins Act, a California law that stops cities from imposing rent control on new construction.

That was almost the end of the story for AB 1506, as California landlords reacted with such umbrage that the bill’s principal author, Assemblymember Richard Bloom of Santa Monica, put it on hold for a year.

Legislation that isn’t moving forward has a shorter shelf life than farmers market produce most of the time, so it seemed the rent control expansion might die a quiet death on the back burner. But the proposal has, improbably, survived. And it’s slated for its first public hearing in Sacramento on Thursday, January 11.

The bill is the sole agenda item for the Assembly’s Housing and Community Development Committee this week. AB 1506 still has the exact airtight, no-frills wording as when lawmakers first introduced it last year:

“The Costa-Hawkins Rental Housing Act prescribes statewide limits on the application of local rent control with regard to certain properties. This bill would repeal that act.”

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Rents in San Francisco and Oakland down at the End of 2017

Continuing the trend we first noticed forming at the end of 2016, asking rents for apartments in San Francisco and Oakland ended the year lower than at the start of 2017.

In fact, based on a comparison of nearly 2,400 listings, the weighted average asking rent for an apartment in San Francisco, including one-off rentals as well as units in larger developments such as Avalon’s new complex in Dogpatch, is currently running around $4,000 a month, which is around 4 percent lower versus the same time last year and roughly 10 percent below a peak in the fourth quarter of 2015.

And the average asking rent for a one-bedroom apartment in San Francisco is currently running around $3,400 a month having crossed the $3,600 mark in 2015.

Read more from SocketSite

Powell as Fed Chief—A Win for CRE Investors and Lenders?

As 2017 comes to a close, commercial real estate total transaction volume is over $500 billion according to CoStar. Although, that equates to a 14 percent year over year decline, many forget that those levels are still higher than 2006—a banner year. Regardless, numerous industry observers are holding their collective breath. In fact, Janet Yellen began 2017 indicating a potential bubble in commercial real estate driven in part by today’s extended low interest rate environment.

In response, lenders, investors and regulators remain anxious with the possibilities of cap rates blowing out in the face of rising interest rates. But are these concerns warranted and will the nomination of Jay Powell actually lead to strong levels of commercial real estate price growth?

Read more from National Real Estate Investor

Google Proposes One Million Square Foot Project in Sunnyvale for 4,500 Employees

The second half of 2017 brought some much-desired attention to San Jose, the self-proclaimed capital of Silicon Valley. It all started when Trammell Crow announced that its Diridon Station project was tied to Google, and the subsequent negotiations the Mountain View tech giant started with San Jose’s elders to expand even further in the city. A slew of activity emerged in the city from hotels to office buildings to apartment complexes trading hands and institutional investors really zeroing in on the opportunity this could bring. The 86-acre, 4 million square foot approval Apple received from the city of San Jose in 2016 was not even mentioned in the news—the excitement seemed to be all about Google.

Yet Google’s ambitions are much broader than just one city. In late December, Google initiated plans with the city of Sunnyvale for a roughly 1.042 million square foot office project on approximately 40.5 acres of land it owns in the Moffett Park district. The ten parcels that Google owns are bounded by Caribbean Drive, Mathilda Avenue, Bordeaux Drive and Borregas Avenue. There are thirteen single story buildings on the property today totaling 801,670 square feet, and they include a combination of warehouse, light manufacturing, R&D and office uses, according to a letter submitted to the city by Google’s Senior Director of Design and Construction, Joe Van Belleghem.

Read more from The Registry

How CRE Investors Could Cash in On the Tax Bill

President Trump signed the new Tax Cuts and Jobs Bill on Dec. 22, effectively putting the final seal of approval on the most substantive tax law changes that the country has seen in 30 years.

It may take some time to crunch the numbers to determine just how much tax savings the new tax bill could generate for commercial real estate investors. The general view is that provisions specific to property owners and developers will deliver a net positive result—although not nearly the windfall that corporations will see with a drop in the tax rate from 35 percent to 21 percent.

Read more from National Real Estate Investor

Alameda County Planning To Sell Its Stake In Oakland Coliseum To Oakland

Alameda County wants out of its share of the Oakland Coliseum.

With three sports teams potentially leaving the site in the next few years, Oakland and the county are in talks for the city to buy out the county’s stake, the San Francisco Business Times reports. Full control of the site would make it easier for Oakland to redevelop the site.

The city and county still have bonds worth $200M to pay off that were used to finance the expansion of the stadium for the Oakland Raiders and renovate Oracle Arena. Those bonds could complicate negotiations. The county could pay off its portion of the debt, but there is no indication as to how the debt is structured and whether it can be paid off early.

Read more from Bisnow

Oakland Approves Tenant Relocation Assistance for Owner Move-Ins and Condo Conversions

The Oakland City Council last night approved new financial assistance for renters displaced by certain types of no-fault evictions.

Under the new rules, if a tenant is evicted by a landlord who is moving into the rental unit, or whose immediate family member is moving in, the landlord must pay the tenant an amount between $6,500 and $9,875, depending on the size of the rental unit. Similarly, if a landlord evicts a tenant in order to convert the apartment into a condominium, the payments also have to be made.

Read more from East Bay Express

Tenant Buyouts of up to $310,000 in San Francisco since 2015

Since March of 2015, when San Francisco started regulating “buyout agreements” between landlords and their tenants, a total of 772 buyout agreements have been inked and reported.

While the highest reported buyout totaled $310,000 for three tenants in the Mission back in July of 2015, the highest reported buyout for a single tenant was $250,000 for a unit on 21st Avenue in the Lake District last year.

And while the total number of reported buyouts has dropped from 319 in 2016 to 258 in 2017, as of November this year, the average buyout amount has increased from $36,839 per building in 2016 to $42,806 in 2017; or on a per tenant basis, from $22,698 in 2015, to $23,504 last year and $27,495 in 2017 to date.

Read more from SocketSite