Note: For a complete picture of the San Francisco Bay Area office market, this report tracks metrics for both traditionally leased office space (asking rents per sq. ft., vacancy rate) and the serviced/flex office industry (serviced office inventory, per-desk asking price). See the methodology section at the bottom for more information.
Key Takeaways
Shared Offices:
- Coworking inventory expanded in every Bay Area sub-region in Q3, with the region adding a net 248,000 square feet, the largest gain of any U.S. market, to reach 7.5 million square feet across 345 locations.
- The share of coworking out of total office space increased to 2.5% in San Francisco proper as traditional office inventory narrows.
- Per-desk asking prices stood at $775 at the end of Q3 in San Francisco proper, 25% above the Bay Area average of $621 per desk.
Traditional Leases:
- Asking rents for traditional office space in the San Francisco market decreased by 0.3% Q-o-Q to $64.92 per square foot, while the wider Bay Area market recorded rents at $56.99.
- The San Francisco office market closed Q3 with 26.7% of its office space vacant, among the loosest major markets nationwide, while the wider Bay Area stood at 22.9%.
The Bay Area’s coworking sector had a stronger quarter than any other flex market in the country, and the growth was spread unusually wide. Rather than a single cluster of openings, Q3 brought fresh inventory to submarkets ranging from the North Waterfront and the Mission District to Palo Alto and Downtown Oakland. Tenants continue to be faced with a choice between the city and outer tech corridors as they have for several years, and flex operators continue to follow demand in a San Francisco flex office market that’s increasingly decentralized.
The conventional lease market tells a different story. Asking rents in the San Francisco market have found a floor as national rents tick down, while market-wide vacancies moved higher for a second quarter in a row even as SOMA and the North Financial District continue to attract AI leases.
Coworking Office Inventory: Operators Add 248,000 Sq. Ft. of Inventory Across the Bay
The Bay Area’s coworking stock reached 7.5 million square feet at the end of September, a net addition of 248,000 square feet (3.4%) over the quarter and the largest gain recorded in any U.S. market. Operators opened 25 more locations than they closed, lifting the regional count to 345, a 7.8% increase at a time when the national location count grew by 2.4%. Coworking accounts for 2.0% of the region’s office stock, still short of the 2.5% national benchmark.
Within San Francisco proper, the quarter’s growth happened away from the skyline. The city’s flex inventory rose by 71,000 square feet (3.0%) to 2.47 million square feet, and all six net new locations opened outside the Financial District.
The Mission District led the way with almost 17,000 square feet of new space (20.2%) and one more location, bringing the neighborhood to just under 100,000 square feet. The North Waterfront expanded by 9,500 square feet (8.7%), and Presidio Heights picked up three locations and added a net 44,500 square feet, concentrating coworking inventory growth in Q3.
Downtown coworking inventories held their ground: the North Financial District stayed at 1.07 million square feet and the South Financial District counted 560,000 square feet. Between them, the two Financial District submarkets still hold two-thirds of the city’s coworking space, maintaining coworking’s center of gravity within the city despite additions in other submarkets.
Coworking’s share of San Francisco’s total office inventory rose from 2.3% in June to 2.5% in September, a larger move than the new openings alone would explain. The city’s office stock keeps contracting as obsolete buildings are taken out of the inventory or converted to housing, so flex space is growing as a proportion of a shrinking whole.
The East Bay added more flex space than any other sub-region in absolute terms at 74,000 square feet (4.7%), along with nine net new locations, to finish the quarter at 1.66 million square feet.
Downtown Oakland accounted for a third of that growth, adding 24,000 square feet (6.3%) and two locations to reach 408,000 square feet, while Berkeley West and Walnut Creek Central each gained roughly 17,000 square feet.
In Q3, the Peninsula’s coworking market grew 5.3% to 1.06 million square feet, with Redwood City adding 35,000 square feet. Meanwhile, the South Bay’s inventory rose to 1.61 million square feet after a 1.8% expansion, with growth concentrated in Mountain View West (+18,000 square feet) and Campbell (+15,000 square feet), countering a decrease of 16,000 square feet in San Jose North. The North Bay houses a smaller coworking footprint of 689,000 square feet, which still represents a 21,000-square-foot expansion compared to the end of Q2.
Relative to the size of its office market, the North Bay is in fact the Bay Area’s most coworking-dense sub-region, with flex space making up 3.6% of its stock. San Francisco proper follows at 2.5%, the East Bay at 2.1% and the Peninsula at 2.0%. Meanwhile, the South Bay comes in last for coworking density at 1.3% despite holding the region’s second-largest flex inventory, reflecting the valley’s extensive conventional office space inventory more than a thin coworking offering.
Among the region’s major flex submarkets, Central Berkeley boasts the highest coworking density at 8.2%, followed by West Berkeley with 5.2%. Moving to the North Bay, Santa Rosa – South ranks as the third densest coworking submarket with 4.8% of inventory here being taken up by flexible offices. Other coworking-dense submarkets include Belmont-San Carlos in the Peninsula, San Jose’s CBD and Sunnyvale – East.
Private Office Pricing Stats: San Francisco Proper Asks 25% Premium Compared to Bay Area
A private office desk in San Francisco asked $775 per month on average at the end of September, 25% more than the $621 Bay Area average and 19% more than the national figure of $651.
The Peninsula and South Bay market sits almost exactly on the regional average at $616 per desk, per month (data for this metric is only available for the Peninsula and South Bay as a singular market). The East Bay is situated in a more affordable pricing bracket at $453 per desk, 42% below San Francisco proper and 27% below the Peninsula-South Bay. Consequently, Oakland, Berkeley and the Walnut Creek corridor remain strong options for companies seeking to trade proximity to San Francisco for a lower office bill.
Breaking down private office asking prices by desk count, prices in San Francisco range from $907 per month for a one-to-five desk office to $617 for offices of more than 20 desks, marking a 32% savings margin for larger private offices. Price savings between these two sizing categories increase to 41% in the combined Peninsula-South Bay coworking market.
Consequently, significant discounts further out in the Bay Area only materialize for larger private office sizes. A solopreneur or five-person startup will pay essentially the same per-desk asking price on the Peninsula as in San Francisco. By contrast, the Peninsula and South Bay are 24% cheaper for offices sized for six to 10 desks and 18% cheaper for the 11-to-20-desk range.
Traditional Office Pricing: Rents Stagnate in the City, Continue Climb in Peninsula
Conventional asking rents in the San Francisco market ended Q3 at $64.92 per square foot per year, a shade below the $65.13 recorded in Q2. The wider Bay Area market reached $56.99 over the same period, one of the few large markets to post an increase in a quarter when the national average slipped 1.5% to $33.18. San Francisco remains 96% above that national figure and second only to Manhattan ($72.03) among the major U.S. markets.
The highest rents in the region are still along the Peninsula’s tech corridor rather than inner San Francisco submarkets. Menlo Park ($104.23), Daly City ($100.79) and Palo Alto ($100.19) all ended Q3 above $100 per square foot, with Mountain View West ($96.17) and Brisbane ($90.64) next in line. Inside San Francisco, the North Waterfront set the city’s high mark at $94.08 per square foot, while the North Financial District was steady at $62.47 and the South Financial District edged up 1.9% to $49.68.
The East Bay tops out with Downtown Oakland at $62.39 per square foot, followed by Walnut Creek Central at $55.57 and Berkeley Central at $51.96. The region’s cheapest conventional office space is in the North Bay and the far South Bay: Rohnert Park asked just $16.51 per square foot, roughly half the national average, with Napa County ($19.47), San Jose South ($19.77), Oakland – East ($20.32) and Santa Rosa North ($20.87) also among the Bay Area’s most affordable submarkets.
Vacancy Rates: San Francisco Rate Reaches 26.7%
Vacancy across the San Francisco market rested at 26.7% in Q3 2026, marking the highest rate among all major U.S. office markets. That leaves the market exactly where it was a year ago and 210 bps below the 28.8% peak reached at the end of 2024.
Meanwhile, the wider Bay Area recorded office vacancies at 22.9%, 30 bps higher than last quarter but almost 1 percentage point below its level from one year ago.
Methodology
This quarterly report covers shared office space inventory, pricing and traditional office market context across the covered region.
Shared space inventory, asking rents and vacancy data were sourced from Yardi Research. Serviced office desk pricing was sourced from Hubble listing data.
Coworking (or flexible) space inventory refers to office inventory operated by coworking, serviced office and managed office providers. Quarter-over-quarter changes in shared inventory were reported in both absolute and percentage terms. The ratio of shared space out of total inventory is calculated as shared space inventory divided by total office inventory.
Market definitions: the San Francisco market and the Bay Area market follow Yardi Research’s office market boundaries, and asking rent and vacancy figures are reported at this level. The San Francisco market covers San Francisco proper, the Peninsula and the North Bay excluding Solano County; the Bay Area market covers the East Bay, South Bay and Solano County. Sub-regions (San Francisco proper, the Peninsula, the South Bay, the East Bay and the North Bay) are reported for shared inventory and desk pricing.
Average desk prices represent the average monthly listing price for a private office desk based on active Hubble listings during the reporting period.
To ensure statistical reliability, headline Desk Price figures are reported only for regions with at least 10 listings with pricing included and sub-regions with at least 5 listings with pricing included. Desk Price by Office Size segments average monthly desk pricing by the size of the private office using a lower threshold of at least 5 listings with pricing per region and at least 3 listings with pricing per sub-region. Regions and sub-regions that fall below these thresholds are omitted from the corresponding tables.
Asking Rent refers to the average full-service (or “full-service equivalent”) asking rent per square foot per year for traditional office space that was available as of the report period.
Vacancy rates do not include owner-occupied properties.
Reporting periods are defined as follows:
- Q2 2026 — Data as of the end of June 2026.
- Q3 2026 — Data as of the end of September 2026.
