San Francisco medical office vacancy rises as demand cools

San Francisco’s medical office market showed modest signs of softening in the first quarter, as vacancy edged higher and net absorption turned negative after a period of relative stability. The medical office vacancy rate increased to 10.5%, up from 9.9% in the fourth quarter of 2025, while net absorption fell to –48,700 square feet, reversing the modestly positive and flat trends seen late last year. No new medical office buildings were completed during the quarter, leaving total inventory unchanged at 8.39 million square feet.