Real Estate Developers are Losing Faith in the Silicon Valley Office Market

Silicon Valley Business Journal (July 20, 2016) A closely watched measure of real estate developers’ sentiment turned sharply lower, suggesting a pullback is on the horizon for the region’s go-go office growth. That’s the message from the latest Allen Matkins/UCLA Anderson Forecast California Commercial Real Estate Survey. The report, released Wednesday, found that by 2019, Silicon Valley office developers expect rental rates to be lower, and vacancy rates higher, than they are today. “What we saw in this survey was really a bit of a peak in the middle part of 2014. What we’ve been seeing ever since then is a slow but basically continuous decline,” said John Tipton, an attorney with the law firm Allen Matkins, which works with UCLA on the report.