S.F. Tops Market for Property Investment

San Francisco, for the fifth straight year, was ranked by investors as the top U.S. commercial real estate market, according to the annual study by Lend Lease Real Estate Investments and PricewaterhouseCoopers. The study also found that investors expect downtown office buildings, apartments and warehouses to perform well while limited service hotels and retail shopping centers lag because of overbuilding. New York was ranked second, followed by Boston, Los Angeles and Washington, D.C. These cities all characterized by tough zoning laws, which limits new development. The report is based on interviews with more than 150 real estate industry officials. Lend Lease is the biggest manger of property assets on behalf of pension funds. The San Francisco market, which also includes San Jose and the Silicon Valley area, is expected to outperform even though record high rents are forcing some businesses to the far suburbs, said the study.