In an article published on Law360.com titled "Tech Was ‘Not Tethered To Spreadsheets’ For 2014 RE Buys," Simon Adams of Reed Smith’s Real Estate Practice Group comments on the real estate market effects in Northern California caused by a booming tech industry demand for office space.
Tech companies are doing massive deals, often demanding lease terms and amenities not driven by bottom line considerations. And, they’re willing to pay top dollar, affecting the overall market for commercial space.
“Players in Silicon Valley are into what you would describe as a land grab,” Simon T. Adams of Reed Smith LLP said. “They are so willing to take real estate positions.”
The demand for space is so great that due diligence periods have narrowed, forcing lawyers to work quickly and creatively to get deals completed before competitors for the same space can take action.
“Lawyers have both anticipated their clients’ needs and desires and at the same time kept a very close eye on other interested parties and anticipated what their reaction would be,” Adams said. “Because of that, they’re willing to change the structure of a transaction or part of a transaction. … There’s a level of creativity that’s new.”
The full article can be read here.