San Francisco's dynamic energy in the commercial real estate market seems to be influencing some of the suburban communities in the North Bay, as well as Sonoma County, where Vacancy rates and industrial properties have weakened evidently over a period of three years. According to a report in Press Democrat, in recent years Petaluma businesses have leased hundreds of thousands of square feet of space. Now those spaces are vacant after a large group of telecom workers left the city.
At the same time, some consider the county's industrial space to be scarce.
What's happening now has happened before, Sonoma State University economics professor Robert Eyler said. As real estate rates soar around San Francisco and Silicon Valley, more companies start to look for new space around the South Bay, East Bay, Marin and Sonoma counties.
According to Press Democrat, Santa Rosa commercial brokerage Keegan & Coppin/Oncor International reports that the county's vacancy rate for office space dropped to 16.2 percent this summer, and comparing it to the previous year, it is down from 18.3 percent. During the last recession, the office vacancy rate reached as high as 24.8 percent at the close of 2009 and was still at 22.2 percent up to the third quarter of 2012.
Now the market for industrial space is even tighter because supply is constrained against demand. According to Keegan & Coppin/Oncor International, only 6.4 percent of the industrial space in Sonoma County was vacant this summer whereas it was 8.5 percent in 2014 and three years ago 13.3 percent.
Chairman and CEO of Codding Enterprises Brad Baker said, "It's definitely the strongest market that we've seen in seven or eight years. I think it's going to grow stronger, and I think that bodes well for the economy."
