Widening loan defaults and foreclosures haunted Bay Area properties in 2024, but a late-year flurry of significant tech industry leases offered hope for the battered South Bay office sector. Throughout the year, sky-high vacancy levels jolted Bay Area buildings, a dearth of business travelers posed problems for hotels and expensive financing afflicted the suddenly shaky apartment market. Downtown San Jose and the city’s SoFA district, looking north, as seen on Dec. 5, 2024.
However, as the year closed, impactful office deals by high-profile tech companies may have foreshadowed a rebound in the sputtering sector in 2025. Several big leases — one of them a huge rental agreement that could accommodate thousands of workers — occurred in the South Bay alone. Snowflake subleased 773,000 square feet of office space in Menlo Park, enough room for 3,800 workers. Nvidia leased 101,600 square feet of office and research space in North San Jose. And it wasn’t just leases. A few technology powerhouses also pulled off some of the biggest property purchases in the Bay Area, particularly in the South Bay — transactions that helped to buoy the sinking commercial real estate sector in the nine-county region and portend a back-to-the-office trend for next year. “More and more companies in Silicon Valley will have people working in offices in 2025,” said Chad Leiker, a first vice president with Kidder Mathews, a commercial real estate firm. “If that happens, it will bring us closer to where we were in the old days” before the COVID-19 outbreak. The year began ominously, providing an early glimpse of what became a trend throughout 2024: A big office building was facing foreclosure due to a delinquent loan. Located at 3100 North First S