San Francisco's Office Leasing Market Sees Significant Uptick in Q1 2025

San Francisco's office leasing market experienced a notable resurgence in the first quarter of 2025, with leasing activity reaching a decade-high of 3.4 million square feet. This surge is largely attributed to substantial deals within the technology sector, signaling a robust recovery in the city's commercial real estate landscape.​

Technology Sector Drives Leasing Activity

The technology industry has been a primary catalyst for this leasing boom. Companies like Google have been at the forefront, securing significant office spaces in the city. In Q1, Google renewed and expanded its lease at 345 Spear Street by 430,000 square feet and extended its lease at 215 Fremont Street by 274,000 square feet. Other notable tech firms, including JPMorgan Chase, Lyft, and Databricks, also contributed to the leasing uptick, with deals ranging from 150,000 to 280,000 square feet.​

Market Recovery Indicators

This leasing activity has positively impacted the city's office market dynamics. The total availability rate for office spaces in San Francisco decreased to 35.6% in Q1, marking a 100 basis point decline from the previous quarter. This reduction in vacancy rates suggests a growing demand for office spaces, particularly in prime locations.​

Financial District's Premium Market

The Financial District continues to command the highest average rents in the city. The northern part of the district averages $70.17 per square foot, while the southern portion averages $72.17 per square foot. This trend underscores the area's desirability among businesses seeking top-tier office spaces.​

Outlook Amid Economic Factors

Despite the positive leasing trends, challenges remain. High interest rates and economic uncertainties persist, potentially affecting future market stability. However, the current momentum in leasing activity, driven by the technology sector, provides a hopeful outlook for the city's office market recovery.​

Source: https://www.globest.com/2025/04/09/tech-deals-lead-san-francisco-office-leasing-to-10-year-high/

Institutional Investors Back 3650 Capital With $215 Million for CRE Strategies

MIAMI, FL — 3650 Capital, a nationwide commercial real estate lender and investment platform, has successfully raised $215 million in capital commitments from prominent institutional investors, including Mubadala Investment Company and the California State Teachers’ Retirement System (CalSTRS). This funding will be allocated across the firm's diversified lending strategies, enhancing its capacity to support a wide range of commercial real estate projects.​

Strategic Deployment of Capital

The newly secured capital will be deployed across three primary financing strategies:​

1. Long-Term, Fixed-Rate Loans for Core Assets
   Providing stable, long-duration financing for well-located, income-producing properties.

2. Transitional and Bridge Loan Financing
   Offering flexible solutions for borrowers undertaking property repositioning or upgrades.

3. Special Situations and Opportunistic Lending
   Focusing on distressed real estate debt, recapitalizations, and equity investments in transitional assets.

These strategies enable 3650 Capital to remain agile in a dynamic real estate market, offering both short- and long-term capital solutions across the U.S. commercial property landscape.​

About 3650 Capital

Founded in 2018, 3650 Capital is a real estate lending and investment platform known for its relationship-driven underwriting, portfolio management expertise, and long-duration loan offerings. The firm manages billions in assets across the U.S. and has emerged as a key lender in today’s dynamic commercial real estate environment.

Source: https://www.globest.com/2025/03/27/cre-lender-raises-215m-to-deploy-across-financing-strategies/

Major Financing Secured: Hudson Pacific Raises $475M Backed by Six Prime Office Assets

Hudson Pacific Properties has obtained a $475 million commercial mortgage-backed securities (CMBS) loan, a strategic move that reinforces the company's financial position while spotlighting its premium office holdings in California and Washington.

The financing, structured with legal guidance from Gibson, Dunn & Crutcher LLP, is secured by a portfolio of six office properties located in key innovation and business hubs, including Los Angeles, San Francisco, San Jose, and Seattle.

Targeted Use of Funds

Proceeds from the transaction will be used to reduce existing debt obligations, including full repayment of a $168 million loan connected to the company's Element LA campus, and to pay down its corporate credit facility.

“This financing delivers nearly half a billion dollars in capital that enables us to fully repay the Element LA loan while increasing our financial flexibility,” said Harout Diramerian, CFO of Hudson Pacific. “It supports our broader strategy to manage upcoming debt maturities through increased liquidity and selective asset sales.”

The Portfolio: Six Prime Office Properties

The loan is backed by six assets that reflect Hudson Pacific’s strategic presence in top-tier West Coast markets:

• Los Angeles:

  • 11601 Wilshire Blvd. – A 25-story tower that serves as Hudson Pacific’s headquarters.

  • Element LA – A creative campus spanning 12 acres and home to Riot Games.

• Seattle:

  • 450 Alaskan Way – A newly completed eight-story office building.

  • 5th & Bell – A six-floor office asset with Amazon as a key tenant.

• San Francisco:

  • 275 Brannan Street – A fully renovated three-story office space in SoMa.

• San Jose:

  • 1740 Technology Drive – A 216,000-square-foot property located in the heart of the Silicon Valley corridor.

Flexible Terms Support Long-Term Strategy

The financing carries an initial two-year term, with the option to extend annually for up to three additional years. This structure gives Hudson Pacific the breathing room to pursue further asset optimization and liquidity planning.

While no additional comments were provided by the company, the move signals a proactive approach to managing market headwinds while reaffirming confidence in the long-term value of its core holdings.

Source: https://www.law360.com/articles/2317923/gibson-dunn-pilots-hudson-pacific-s-475m-office-financing