News
HOW HOT CAN SOMA GET? (PART DEUX)
February 28, 2012
| There's so much happening in SoMa that we couldn't fit it into one day of coverage. Here's more from Bisnow's Future of SoMa event at the Westin Market Street. (Soon we're going to have to produceSoMa: The Miniseries.) |
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| Matt Field, managing director of TMG Properties (which does urban infill and bought 2M SF in the last 24 months in SoMa), said it’s still pretty tough to finance something coming out of the ground. While tenants like large floor plates, there is increasingly less supply. He says it’s not just tech firms that want cool and creative space but now all kinds of other companies, except (so far) law firms. (But who knows? Perhaps every law firm will soon have a ball pit and a Nintendo Wii. Stranger things have happened.) And he says basis buying is over—it’s largely momentum buying today. |
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| NicholsBooth Architects’ Gary Nichols, who specializes in commercial and healthcare interiors for clients like Stanford Hospital & Clinics and Zynga, says one of the most startling changes he’s witnessed is the disappearance of the private office, which is being replaced by a lot of smaller work stations, conference rooms, and sports bar kitchens. Density is going down to 150 SF per person and, in some cases, much less, while the conference room ratio is now down to one per eight employees. |
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| Allen Matkins legal guru Tony Natsis has dealt heavily in tech space and has seen it all, including provisions to strengthen a garage because tenants wanted a Jell-O wresting pit on the roof. Oh, and clauses not just to allow dog walks but… reptiles. Meanwhile, in 2004, Tony says, capital markets activity was 2/3 SoCal and 1/3 NoCal; now it’s flipped. |
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| Kilroy’s Mike Sanford (whose public REIT owns 16M SF, of which a couple million are in SoMa) says its mission is to take risk and find buildings that need renovating. It has found 303 Second, 201 Third, and 370 Third, where he’s especially excited about leasing to the Pac 12 Network. He joked that his lawyer Tony Natsis might remember it as the Pac 8… or even 6. Tony responded he was the moderator and could pull the plug on Mike's microphone. Mike said he pays Tony’s invoices. Tony replied they’ve just gone up dramatically. |
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| After the event, which was held in an unconventional theater-in-the-round setting, we walked around SoMa and felt vindicated by the motto we encountered in the first floor windows here at Howard and New Montgomery: “Creative People Need Creative Space.” |
