2020 Q1 Sacramento Office Report

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Sacramento’s office market started off 2020 on quite a positive note. From Penumbra’s medical device manufacturing facility opening in Roseville in January to the sale of Park Tower Downtown to KBS in February, Sacramento seemed poised for another banner year. The market vacancy rate fell to an 18-year low and tenant activity throughout the region has unveiled still strong demand. However, everything changed in March. The COVID-19 pandemic has now shut down much of the economy and businesses are being forced to make tough decisions to trim costs and stay solvent. While the future outlook for Sacramento’s office market is unclear, it is important to remember the solid fundamentals that were in place prior to the lockdowns. The average square feet occupied per employee was already declining prior to the pandemic, but as employees work remotely, employers may be further inclined to reevaluate office space needs. The full impact of COVID-19 is not reflected in the first quarter numbers, but a significant slowdown in leasing and sales in the second quarter will likely be followed by a healthy rebound later in the year. Office landlords have received a growing number of rent relief requests from tenants and many are deciding to work collaboratively to address these massive disruptions.

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2020 Q1 Sacramento Office Report

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Related Experts

Bill Swettenham

Executive Vice President

Sacramento

I have spent the last 35 years immersed in the commercial real estate industry with the last 15 specializing in the medical community. Throughout this time, I have developed my expertise in the planning, leasing and sale of office buildings and land throughout Northern California and abroad. In addition to direct experience working alongside office developers to assist with highest and best use, I provide foresight and ingenuity to portfolio optimization, process standardization, risk mitigation, and financial analysis.  

As an experienced transaction manager, I have found the key to a successful plan is through a team-based approach - collaborating with experts from varied specialties including coordinating with local construction consultants ensures the presence of expertise within critical components for a successful facilities strategy,

My goal within every interaction is to marry my client’s desires with my real estate knowledge to achieve success.  This client-focused approach has earned me a solid reputation for creating value and defining risk for both tenants and ownership alike.

I served as a pilot in the US Air Force for 7 years before moving to commercial airlines for 8 years. Sacramento has been home for my wife and two children for the better part of three decades.  In my free time I enjoy family, friends and a round of golf.

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Blake Bouldin

Transaction Manager

Sacramento

Intrigued by a lifetime of family dinner conversations surrounding the many facets of real estate, I decided to take a real estate course in college and was immediately hooked.  Beginning as a research analyst at Colliers International for nearly 3 years, I have developed a deeper level of understanding of market behavior in Sacramento and a proficiency to provide real estate solutions and analytics for my clients that are beyond the norm.  My pursuits are to help my clients mitigate their risks and maximize their value by partnering with them and aligning my goals with theirs. I am a thorough problem solver and a dedicated advocate for my clients.

Bill Swettenham, Eric Ortiz, and myself bring together a team of real estate professionals, committed to understanding and serving the unique needs of the healthcare client, from owners to investors and healthcare providers. As dedicated healthcare experts, we understand the specific needs of healthcare real estate, its complexities, and stay abreast of new regulations and market trends that are affecting the industry.

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Tyler Nielsen

Associate

Sacramento

Beginning as a research analyst at Colliers International, I developed a deeper level of understanding of the many submarkets within Sacramento and became proficient at providing analytical support to my colleagues and our client.  My pursuits are to help my clients mitigate their risks and maximize their value by partnering with them and aligning my goals with theirs. I am a thorough problem solver and a dedicated advocate for my clients.

As an Associate at Colliers, I specialize in advising office tenants, property owners, and investors to develop and implement real estate strategies to help their business succeed.

Due to my success as a Research Associate, I was brought on as a member of the Northern California Healthcare Advisory Group lead by Bill Swettenham and Eric Ortiz. We bring together a team of real estate professionals, committed to understanding and serving the unique needs of the healthcare client, from owners to investors and healthcare providers. As healthcare experts, we understand the specific needs of healthcare real estate, its complexities, and stay abreast of new regulations and market trends that are affecting the industry. The group is committed to applying our combined experience working with Medical Office clients on land acquisition and disposition, development, building acquisition and sales, and landlord & tenant lease representation.

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Bob Dean

Senior Vice President

Sacramento

After three years spearheading a business development team at Pacific Legal Foundation, a national nonprofit public interest law firm based in Sacramento with an emphasis on real property rights, I am happy to be back in commercial real estate having found a new home at Colliers International. My commercial real estate experience spans nearly 30 years as a Managing Director of the Sacramento, Bay Area, Portland, Denver, and Seattle offices at Grubb & Ellis, and I developed a hands-on perspective of those geographies and markets. This allows me to provide you with a wider perspective of the overall real estate market and anticipate changes in the CRE cycle. Colliers provides me the complete platform to team up with experts with market knowledge in nearly every commercial real estate service line—office, retail, industrial, investments, land, property management and evaluations. 

I am your liaison, consultant, broker, market specialist, and partner. Whatever your unique business needs, opportunities, or challenges may be, I leverage my varied background to assess the broker skill set best suited for the project developing a team of experts tailored to your needs. Together we will develop a strategy to achieve your long and short term business goals whether that be leasing up a space in preparation to sell or qualifying and identifying new product to acquire. In addition, drawing from my recent experience with Pacific Legal’s work with property rights, I feel even more prepared to help my clients achieve success in their business.

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Dan Green

Associate

Sacramento

There is one connection amongst all the roles I have had during my career: the opportunity to help people and their businesses in Sacramento and El Dorado Hills. After 10 years in sales and management, I decided to pursue a career in commercial real estate. I like to find creative ways to help my clients achieve their goals by placing myself in their shoes. As a commercial real estate broker, my clients and I develop a partnership so that together we can navigate some of the barriers they may be facing with their real estate.

Whether you are an owner-user, tenant, or an investor, commercial real estate can be overwhelming. To gain a better understanding of my client’s goals and develop a clear path on how to achieve them, I like to start out with a discovery meeting. This is an opportunity to get to know and understand what’s important to the them and the needs of their business. Often, there is a gap between where the client is and where the client wants to be. The next step is to review that gap with my client and plan to bridge that gap. Laying it out in simple steps and forming a plan together makes the process much more palatable.

When I’m not at work, I'm either spending time with my family or friends.  My wife and I reside in El Dorado Hills with our two daughters.  Whether we're at the farmer's market, hinking a trail around the lake, or even snowboarding in Tahoe, we  enjoy all  that our small town has to offer and all of the  local activities. 

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David Herrera

Executive Vice President

Sacramento - Downtown

I have dedicated my career to working all things real estate in the Sacramento  Downtown/Midtown markets. My primary focus has been working in office product with tenants and landlords with a focus to understand client’s needs, identify and consider all possible options, and securing results that exceed expectations. As an advisor and an ally, I provide my clients with consultative services on site selection, financial analysis, lease and contract negotiations, as well as renewal and expansion assistance. I aim to be a resource for all Colliers Sacramento brokers looking to purchase, sell, or lease space in the grid.

Having negotiated millions of dollars in purchase and lease contracts, the utilization of innovative practices and knowledge of the intricacies of contract negotiation has earned me recognition as one of the prominent Downtown and Midtown commercial real estate agents.

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Eric Ortiz

Vice President

Sacramento

As member of the Northern California Healthcare Advisory Group (NCHAG), I specialize in providing real estate solutions for local and national medical groups. Medical office buildings (MOB) are far more nuanced than traditional office buildings and the needs of MOB users are intricate and specific. My clients partner with my group because they have confidence in on our up-to-date knowledge of state & federal regulations, healthcare trends, and awareness of the inherent risks that are unique to medical real estate. I pride myself as a student of the healthcare industry to stay abreast of the changes in regulations and impacts that the healthcare industry has on the medical real estate market.

I began my real estate career with C. Strain Corporate Real Estate which was acquired by Cushman & Wakefield in 2007. My experience throughout my tenure has included landlord & tenant representation, and the disposition and acquisition of office and flex investment properties on behalf of owner/users and institutional clients.

Outside of Colliers, I enjoy playing soccer, practicing photography, and spending time with my wife and two beautiful daughters. 

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Jason Rutherford

Senior Vice President

Sacramento

My interest in real estate began at an early age watching my mother build a successful career as a residential agent. After joining Grubb & Ellis Company as an intern in 1997, I developed my passion for the office and investment sales arena. I like to be very active and have a hands-on understanding of the market. Office leasing and sales requires me to be consistently on top of the ever-changing real estate landscape. Knowing what is going on in the market is not enough to provide the exceptional and service my clients have come to expect from my team and me. To accomplish and surpass our clients’ goals, we analyze historical data, stay educated on CRE trends, and forecast future market activity.

Having open and constant lines of communication while actively listening to my client’s needs is the most important part of having a successful partnership. My approach is simple: listen to what the client needs/wants verse telling them what I think they need/want, all while leveraging my 17 years of experience. Excellent communication and business acumen have enhanced my ability to structure creative real estate solutions for complex situations. No matter the project or assignment, I always aim to exceed my client’s expectations while developing a partnership based on clear communication and mutual respect. My clients depend on my creativity, diligence, and ability to deliver results.

My determination to surpass expectations and provide top-notch service is evident in the evolution of 555 Capitol Mall. After selling the property at 56% occupancy, my team and I worked diligently to lease up the remaining space. In a brief period, we leased 90% of the space at stronger rents than projected. 555 Capitol Mall had its own challenges, as does every project. Transacting real estate is not hard, finding space is not difficult, but being creative, innovative and aggressive while protecting every cent is a challenge I engage in every day. My true “WE” effort with a passionate attitude positions my clients for success.

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Ken Johnson

Research Analyst

Sacramento

Since 2007, I have worked alongside Tom Walcott, Jason Rutherford, Kris Reilly, and Scott Bennett providing honest and intelligent guidance to local and regional owners of office property throughout the Sacramento Area. Working with integrity, I handle my client’s commercial real estate needs as if they were my own. 

While pursuing my own smaller tenant, landlord, and investor projects, I also provide support to my partners through the coordination of marketing, contracts, and transaction management. Through this experience, I have developed significant knowledge of the procedures necessary to transact a real estate deal.

Within Sacramento Brokerage, I oversee the research department. In this role, I manage the creation of our quarterly market reports, gather and distribute information regarding deals and market activity, and provide our brokers with tools and knowledge to help them better service their clients. This opportunity has made me more aware of market activity and the trends that affect all specialties such as industrial and retail commercial real estate. I can provide a more unique perspective to my clients than those who focus on one market sector.

My greatest accomplishment in life is being a father to my two daughters. I am actively involved in their extra-curricular activities including coaching softball & soccer and being a founding board member of Land Park Softball.

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Kris Reilly

Senior Vice President

Sacramento

Kris has 17 years of experience in commercial real estate. He is focused on Office Leasing and Sales in the greater Sacramento market. He and his team have recently completed more than $40 million in transactions.

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