I met my friend Bill Benton for lunch recently and persuaded him to try Barbacco, a restaurant across the street from his office. He and I had never been.
It was lunchtime on a Friday and the place was packed. It is the smaller sister of Perbacco next door and the entrees for lunch never ventured above $12. This might have been why the joint was jumping.
Bill and I settled in and took a gander at the menu. Bill’s a steak and potatoes guy and I had to twist his arm a bit to get him to give the burrata cheese starter a try. Our lunch decisions made, we started to talk shop.
Bill is a principle at Newmark Knight Frank, a commercial real estate firm here in San Francisco. I asked him how things were going and he let me in on all sorts of good news. It seems his business has really picked up of late. This was a bit of a surprise to me because I had just been on a call with a friend in private equity and he talked nothing but doom and gloom.
"What does this mean?" I asked. "I thought commercial real estate was supposed to crash." He started talking net absorption rates, building loans, etc. At a certain point I lost him but the upshot was clear: folks are starting to rent commercial space in San Francisco; a sign the market is turning. Obviously I don’t think anything drastic is going to happen overnight, but Bill liked the burrata cheese and to me that’s a leading indicator.
You can reach Alicia at www.aliciamorga.com