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San Francisco braces for commercial real estate crash

sfstandard.com

41–50 of 622 posts

Re: San Francisco braces for commercial real estate crash

#41
post #12

Earlier quoted context omitted.

People in SF have backyards? I can see NIMBY as a concern in the rest of the bay area, but SF, it's already stacked housing.

Nope. On an area-weighted basis most of SF is wasted on detached single-family homes. https://www.google.com/maps/@37.7470676,-122.4914956,314m/da...

Americans overwhelmingly prefer single-family detached homes when given other options. How is choosing a higher-quality of life option “wasted”?

Re: San Francisco braces for commercial real estate crash

#42
post #8
post #2

Give the corresponding housing crisis in the Bay Area, one wonders if the solution is to "simply" start converting office space to living space until the corresponding demand for office space recovers from a combination of increased demand and decreased supply. Now I'm sure there are all kinds of challenges to doing that, engineering, zoning, other practicalities, but it seems overall reasonable to me, though perhaps…

Most offices have physical layouts that make conversion to residential difficult to impossible. Big things like lots of interior square footage without windows and plumbing only to a few central locations. And while some or even most of this is fixable, major renovations are a ton of cost and effort to convert them to something that will still be expensive and weird, if even possible to meet the legal requirements of…

They did it extensively in lower Manhattan after 9/11 I thought?

The layout doesn't seem so terrible, minus the plumbing and heating concerns.

Re: San Francisco braces for commercial real estate crash

#43
post #8

Earlier quoted context omitted.

Most offices have physical layouts that make conversion to residential difficult to impossible. Big things like lots of interior square footage without windows and plumbing only to a few central locations. And while some or even most of this is fixable, major renovations are a ton of cost and effort to convert them to something that will still be expensive and weird, if even possible to meet the legal requirements of…

Can they be converted into huge units with an open floor plan and bathroom/kitchen near the center? If someone can figure out how to make it look cool, office conversions could be the 2020s version of the warehouse loft.

Sublime. All of the people who hated working in an open office are screaming at the idea of living in one.

Re: San Francisco braces for commercial real estate crash

#45
post #2

Give the corresponding housing crisis in the Bay Area, one wonders if the solution is to "simply" start converting office space to living space until the corresponding demand for office space recovers from a combination of increased demand and decreased supply. Now I'm sure there are all kinds of challenges to doing that, engineering, zoning, other practicalities, but it seems overall reasonable to me, though perhaps…

But doing reasonable things without deference to “how things have always worked in our society” is unconscionable.

Think of the loss of figurative identity a minority of landlords might incur!

Re: San Francisco braces for commercial real estate crash

#46
post #2

Give the corresponding housing crisis in the Bay Area, one wonders if the solution is to "simply" start converting office space to living space until the corresponding demand for office space recovers from a combination of increased demand and decreased supply. Now I'm sure there are all kinds of challenges to doing that, engineering, zoning, other practicalities, but it seems overall reasonable to me, though perhaps…

It seems like a logical thing to do. A few articles on why it is difficult. https://www.nbcnews.com/business/real-estate/why-empty-offic... https://www.washingtonian.com/2022/07/28/should-dcs-empty-of...

> why it is difficult

The argument in the Washingtonian hints at a policy solution. It cites a "lack windows on at least two sides" with cavernous floors making "direct natural light" rare. The "complexity of adding hundreds of bathrooms and kitchens (not to mention the accompanying venting and plumbing)" is real. "Turning rooftops into amenity spaces" is not.

So yes, these aren't going to become luxury apartments. Will they have less direct sunlight and no rooftop garden? Yes. Are those remotely necessary? Of course not. Fewer windows doesn't mean no windows; this isn't a safety issue. We will probably need code amendments. But that would require political will to legalize affordable housing.

Re: San Francisco braces for commercial real estate crash

#47
post #21

Earlier quoted context omitted.

Modern office buildings only have plumbing available in the center of the building. The flooring is designed to function as a highly efficient membrane. If you start punching holes in the flooring to place plumbing and toilets away from the central core you weaken the floor membrane to the point where it loses the required structural integrity. If you try to build raised flooring to provide space for the plumbing the…

Every place I've ever lived had plumbing in the walls. Now, it also had it in the floors, so your point is well taken. But I seriously doubt that a central plumbing stack is a serious holdup on plumbing out an entire floor. Then again, I don't have any real experience, so I'm very much being optimistic here without actual hands-on knowledge. I could be very wrong, and would love to hear why!

So, this is me reaching back aways in memory. Walls with plumbing through them are held to different standards to other walls. Walls with plumbing use 2 by 6s. Builders and architects try to optimize by making as few walls as possible walls with plumbing because they are more expensive. Your regular walls use 2 by 4s.

So yes, some walls have plumbing running through them, but not all. Any architect and contractor will try to optimize cost by having as few walls as possible with plumbing. Which is why in some apartments, neighboring bathrooms in units will be close or share some wall space.

Re: San Francisco braces for commercial real estate crash

#49
post #21

Earlier quoted context omitted.

Those commercial spaces make it incredibly easy to build them however you like. The access to plumbing and electrical would make it simple to convert them into small dwellings.

Modern office buildings only have plumbing available in the center of the building. The flooring is designed to function as a highly efficient membrane. If you start punching holes in the flooring to place plumbing and toilets away from the central core you weaken the floor membrane to the point where it loses the required structural integrity. If you try to build raised flooring to provide space for the plumbing the…

I see plumbing exposed in the ceiling in some of the cool fancy new lofts that were converted from offices (in NYC).

Re: San Francisco braces for commercial real estate crash

#50

Residential crash is potentially already upon us, at least in the outskirts (East Bay for me). We've had our house on the market for over a month now, and nobody else in the neighborhood is selling either. Big changes from only 3 months ago, when sellers were closing in days.

Turns out prices have to go down when the fed doubles rates. By my math, a 30% correction is needed to make up the difference in terms of monthly affordability - meaning a $500k house at 6% is the same as a $750k house at 3%.

Are those numbers reversed?

Should it be a $750k house at 3% is a $500k house at 6%?

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