If you perform a search for small San Francisco Office Space (less than 1,000 sqft) on Rofo you’ll find many compelling options.   These spaces tend to be short term, furnished and ready to go.  All very important things for an entrepreneur in today’s environment.  But remember not all square feet are created equal.  Depending on the layout and actual usable square feet you’ll fit somewhere between 2 and 5 people in a 1,000 feet.

I’m writing about the San Francisco Bay Area real estate market but you could probably insert any city name.  I’m asked often these days, “What is really happening in the commercial real estate markets?” There’s certainly been a lot of news coverage on the macro level so I thought I’d offer up some specific anecdotes and try to piece it together with some conversations I had this week.

Institutional Landlord: “We do not anticipate signing any new leases through the end of the year.”

Top Broker: “Business is dead.  We’re trying to renew deals that are 18 months out.”

REIT: “If you’re a sizable credit tenant we’d give you just about anything you ask for.  And, if you’ve invested in our fund you’re probably not very happy with us.”

Tech Company: “We just cut our staff in half, froze capital spending and preserving cash.”

Broker: “I heard Myspace and Microsoft are both in the market for significant expansion space.”

Angel Investor: “Due diligence on investment deals is taking twice as long.”

Large Developer: “2009 looks a lot worse than 2008.  And we’re flat lining now. It will be a great year to buy on the cheap.”

So what does this all mean?  Well capitalized landlords and developers will take advantage of a down market in which tenants with credit and good visibility will dictate the leasing terms.

The team over at Alltop has added our blog to their virtual magazine rack of real estate blogs

The site is a very good resource for easily finding the top content in many categories.  I’m personally a fan of real estate and small business. . .

Besides negotiating the rental rate for your new commercial space, there are other creative ways to minimize your overall financial commitment  in your lease agreement.  I recently had the opportunity to contribute an article to Gigaom highlighting 8 of them.  It ranges from capping operating expenses to obtaining flexible subleasing rights.  Naturally a lot of this depends on market conditions and available commercial real estate listings.

For most entrepreneurs and business owners the process of finding a space for your business is an important, critical and THANKLESS task.  We went through it recently as a company and it really is a distraction from focusing on your business.  So, if you’re flying under-the-radar of real estate agents, how do you do it efficiently on your own?  Speaking from experience my number one piece of advice is to plan well ahead and allow plenty of time.  Commercial real estate in general is a slow moving business – you will not miss opportunities because of spaces being quickly snatched up.

We recently revamped our real estate advice section to help you out.  We’re trying to arm you with enough information to get started and not overwhelm you with the detailed terminology that you may or may not encounter.

Our guide to common commercial leasing terms is a very good start.  Always feel free to contact us if you have some sound advice of your own.

Emeryville has been the home to many small businesses and startups that have grown into some of the most recognizable brands. Thanks to Eli Ceryak for providing us with an overview of the Emeryville commercial real estate market.

We have some great things in store for our business users who are contemplating a new home for their business.  We’ll be rolling out videos to help you better understand the markets you’re considering.  The best part is that these vids are coming to you from the experts themselves.  We’d like to thank Trent with Colliers in Oakland who contributed this guided tour of the Oakland, CA office space market.

This San Francisco space listing was recently added to Rofo.  Our office is located very close to this building (the home of Jack Falstaff Restaurant).  Knowing that this location and size are hard to come by, I would think this space would be appealing to many businesses trying to set up shop in the area. . .

This is certainly the conventional wisdom for what’s to come over the next couple of years. Today I saw an article on Reuters that sealed it for me.  Pictured above is Sam Zell (not exactly a household name) who’s Equity Office Properties was sold to a huge private equity firm just before the beginning of the mortgage meltdown.  Zell said the following:

“This is not a time to own commodity (office buildings) in the suburbs,” said Zell, speaking at the DLA Piper Global Real Estate Summit in Chicago. “If there’s going to be a diminution of demand for office space, it’s going to be out there.”

He went on to say that he thought the only the nicest downtown office buildings will fare okay.  Something to certainly keep an eye on if you’re planning to move your company within the next year.

Over the past couple of weeks we’ve had a heavy diet of bad news from Wall Street.  Not necessarily about the markets but about large institutions evaporating.  Many people are asking how this effects commercial real estate and, specifically, the leasing market.  Well, the simple answer is that it does have a rippling effect but its difficult to predict when it will show up in asking rates.

I saw a story recently about the large chunks of sublease space that could potentially come on the market in San Francisco if the investment banks scale back their presence here.  And today I read a story in Time about the “financial madness”.  This was one of my favorite excerpts:

For an example in our backyard, consider Lehman Brothers. Lehman was so flush, or at least felt so flush, that in May 2007 it sublet 12 prime midtown-Manhattan floors of the Time & Life Building — across the street from Lehman headquarters — from Time Inc., which publishes this magazine. Lehman signed on for $350 million over 10 years. (It’s not clear what kind of hit, if any, Time Inc. will now face.)

OUCH!

So, if job growth continues to slow and large blocks of space come back on the market, landlords will eventually feel the pressure to lower rates to compete for business.  Given that the leasing markets have been healthy over the last couple of years who knows exactly when we’ll see that happen.