REAL ESTATE NEWS

San Francisco's recent surge in office-visit growth may be just the shot in the arm California needs to catch up with the rest of the nation's return-to-office trends, according to Caroline Wu, director of research, Placer.ai.

The City by the Bay now leads the nation in year-over-year office, posting visitation growth of 19% in September. That comes as Los Angeles’s 9.9% growth still trails the 13% national average.

But still, compared to a September 2019 benchmark, both Los Angeles (37.4% below 2019 levels) and San Francisco (40.2% below 2019 levels) lag the national return-to-office rate of 26.3%.

However, landlords have reason for optimism, fueled by the AI boom and a wave of new return-to-office mandates that went into effect nationwide, according to Wu.

“The renewed emphasis on in-person collaboration could signal the beginning of a new Gold Rush for California’s office real estate market,” Wu told GlobeSt.com.

Office visits in September 2025 were just 26.3% below 2019 levels, signaling a strong rebound after August’s seasonal dip. For context, September was the third busiest in-office month since the pandemic hit in the U.S., according to Placer.ai, even after adjusting for calendar effects.

Few Adding Office Space in Orange County

Meanwhile, Orange County in the third quarter saw modest space giveback, pushing office vacancy from 16.9% to 17.1%, according to a report from JLL.

Lingering softness is reflected in the market’s three consecutive quarters of negative net absorption, as some tenants remain cautious about adding space.

Most of Orange County’s negative office absorption came from Class B buildings, while occupancy in Class A product was more stable during the quarter.

The Orange County construction pipeline has remained at its lowest level since 2011. Now, office landlords in the area can only hope that the fight for quality and low supply will lead to increased demand in the area and that it will follow the footsteps of San Francisco.

Source: GlobeSt/ALM