Op-Ed, Commercial Real Estate, Bay Area
greg fogg
TenantSee Weekly: What Do You See?

When you look at an office building, what do you see?  Maybe you see the architecture.  Maybe it’s the neighborhood, the restaurants, and amenities.  Perhaps, you see the views from within the building.  This is what most people see.  They’re all important.  But it’s what you don’t see that matters most.

TenantSee Weekly: What Do You See?
Op-Ed, Commercial Real Estate, Bay Area
greg fogg
TenantSee Weekly: Knowing Your When

We see a lot of confusion in the market around when to begin negotiations.  It’s not an insignificant consideration.  In fact, when you begin can make a huge difference in the outcome.  It’s understandable that tenants would not know when to start.  Brokers are not always keen to start at the right time, since compensation is derived by transacting and the closer the tenant is to lease expiration, the faster it will need to transact (and the fewer options it will have).  Good for the broker, bad for the tenant.  This creates a misalignment of interests that discourages thoughtful consultation on the front end – the more time a broker spends on a project, the lower the compensation. 

TenantSee Weekly: Knowing Your When
Op-Ed, Commercial Real Estate, Bay Area
greg fogg
TenantSee Weeky: A Big Decline in Rents, Four ...

Throughout 2020, the prevailing sentiment among investors in the San Francisco office market was one of relative optimism.  After all, despite the fact tenants were prohibited from occupying their buildings, they continued to collect full rent.  The buildings were full, with vacancy hovering around 4%.  Sure, companies weren’t happy about paying for space they couldn’t use, but business was good.  In many cases the tech sector (which makes up most of San Francisco’s office occupancy) was booming due to an even greater reliance on and usage of tech caused by pandemic driven changes in how people were living.  Throughout the course of 2020 there was no reason for San Francisco investors to panic, as few (if any) office occupiers were showing signs of developing long-term hybrid or remote-first strategies.  Most were simply focused on solving for ongoing operations as a temporary reaction to the pandemic.  Yet early indicators did point to a future in which companies would be shedding office space, as some expiring leases were not replaced.  This, coupled with the addition of new supply, caused a big increase in vacancy to nearly 12% by year end.  Despite this large uptick, the brunt of the sluggish demand dynamic was being felt in the sublease markets, where rental economics more accurately reflected the true state of the market.  Despite a total closing of the office market in 2020, average asking rents ended the year off just 6% from the pre-pandemic high.

TenantSee Weeky: A Big Decline in Rents, Four Years in the Making
Bay Area, Commercial Real Estate, Op-Ed
greg fogg
TenantSee Weekly: Modern Workplace Planning: ...

In the years leading up to the pandemic, most medium and small companies defined their office space need based on headcount (current and projected), space programming, and industry/sector norms.  The exercise was mostly formulaic.  The primary differences in the offices of a small, regional law firm compared to those of an AM Law 100 firm would be scale, the cost of finishes, and the quality of the building and views.  It was planning for the same outcome, just at different levels on the cost spectrum.  Companies having a larger portfolio of offices would typically create a “workplace strategy” that included guidelines around programming (e.g., space layout, office size, critical adjacencies, growth factor, finishes, FF&E, etc.).  These guidelines could then be used to inform the real estate process across geography.

TenantSee Weekly: Modern Workplace Planning: Solving for Experience Part I: The Purpose
Bay Area, Commercial Real Estate, Op-Ed
greg fogg
TenantSee Weekly: This, or That?

Negotiations are always about (or should always be about) this or that.  There’s always something else, maybe that something else is nothing (as in sometimes the best thing to do is nothing at all).  Decisions made without proper consideration of all relevant alternative scenarios are decisions made poorly.  As important, in the context of office lease negotiations, the best negotiated outcomes are directly correlated to the extent to which we understand the alternatives of the landlord counterparty.  This is a bit counter intuitive, allow us to explain. 

TenantSee Weekly: This, or That?

#chatgpt

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TenantSee Weekly: A Case for San Francisco

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TenantSee Weekly: A Case for San Francisco

San Francisco: Just 49 square miles of hills, hugged by the Pacific Ocean and San Francisco Bay, but packed with more soul, style, and inspiration than most cities ten times its size.

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TenantSee Weekly: Someone Is Always Applying Pressure

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TenantSee Weekly: Someone Is Always Applying Pressure

Negotiating an office lease is not like most financial transactions. Outcomes aren’t dictated by a single metric—they’re shaped by a complex blend of variables: building class, age, views, landlord cost basis, loan structure, amenities, motivation profile, vacancy, and market dynamics. While experts can project a fair market value using comps from recent arms-length deals, real leverage—and real savings—only emerge through a thoughtful, iterative negotiation process that forces landlords to compete.

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TenantSee Weekly: Short-Term Loan Extensions Don't Equal Stability

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TenantSee Weekly: Short-Term Loan Extensions Don't Equal Stability

We’ve often emphasized the importance of understanding the capital stack—equity and debt—when leasing office space. Today, one of the most critical considerations is: Who is really in control when the capital stack breaks down? The answer is often more complex than it appears

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TenantSee Weekly: Subleasing Office Space - What Tenants Need to Know

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TenantSee Weekly: Subleasing Office Space - What Tenants Need to Know

Subleasing is often misunderstood—both by tenants trying to offload space and those looking to lease it. Here are key considerations from both sides:

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TenantSee Weekly: The Exclusive Right to Represent

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TenantSee Weekly: The Exclusive Right to Represent

At TenantSee, we only advise clients under a formal working agreement that clearly outlines our role as the exclusive representative, the scope of services, and how we are compensated. It’s a short, straightforward document—but a vital one. It establishes our fiduciary duty and marks the official beginning of our advisory relationship.

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TenantSee Weekly: The Long Shadow

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TenantSee Weekly: The Long Shadow

When companies select a real estate advisor, one crucial yet often overlooked factor is the advisor’s credibility with landlords. It’s understandable why this isn't top of mind — credibility is difficult to measure. But it can be among the most valuable assets your advisor brings to the table. Let's break down what "credibility with the landlord" means and why it matters.

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TenantSee Weekly: Is ChatGPT Better Than You (Me)?

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TenantSee Weekly: Is ChatGPT Better Than You (Me)?

If you’re a business professional—accountant, lawyer, engineer, or even (gulp) an office broker—you’ve probably wondered: Can AI do my job better than me?
 
As a broker who advises office tenants, I tested ChatGPT in a domain I know well. I asked it for average Class A office rents in downtown San Francisco over the last 30 years, including supply and demand dynamics. In less than a minute, it delivered a surprisingly accurate answer.