Broker-Owned Company Explores Opportunities In San Francisco

Since the beginning of March, after a majority of the San Francisco workforce spent the pandemic working out of home offices, the city has been putting plans in place to bring some of its employees back to working in person. As part of Mayor London Breed’s "Welcome Back to SF" pledge to revitalize the downtown San Francisco economy, many companies have been putting down dates for when and in what capacity they envision their return.

For Lee & Associates, a broker-owned commercial real estate firm, this positive news has proven that now is the right time for them to continue diving into the Bay Area market. In early March, Lee & Associates opened a new office in San Francisco. While this is the company’s fifth office in the Bay Area, this office is the first in the San Francisco central business district.

Jeff Moeller, managing principal at Lee & Associates’ San Francisco office, said that being in this market provides an exciting opportunity to explore venture capital investments in the area’s booming tech and life sciences industries.

“Even with all of the pandemic restrictions, the vitality of the entrepreneurial spirit of San Francisco has really come back in a big way,” Moeller said. “The large entrepreneurial homegrown tech groups have continued to expand, and we’re seeing some of the most significant transactions for a number of companies.”

Moeller said one prominent trend in the San Francisco office market is that many venture capitalists have incubators on their radar. The incubators’ growth and financial success, especially in life sciences fields such as food technology and medical device creation, have significantly impacted office space in San Francisco.

“It's really staggering to see the amount of capital that is going into these great ideas,” Moeller said. “On the life sciences front, we are seeing similar investment. A significant sign of that activity is that there's almost no incubator space left in the San Francisco Bay Area, which we really feel is an indicator of long-term health for that market. The fact that the rents keep rising and people keep stepping up to take on those rents is a great sign of health.”

Jeff Rinkov, CEO of Lee & Associates, said the company was attracted to the San Francisco market due to the potential for growth within the tech and life sciences industries. The company was also attracted to the city’s entrepreneurial spirit, he said, seeking out new employees who encapsulated that spirit. 

“It’s all about the people for us,” said Jeff Rinkov, CEO of Lee & Associates. “We really want to focus on supporting the people who share our vision and who have an emphasis on creating an entrepreneurial brokerage.”

Rinkov said the expansion to San Francisco was made possible through Lee & Associates’ distinguishing capital structure, which involves keeping funds for the expansions separate from operating capital.

“We raise capital amongst our principals throughout the organization, which has become the driving force for the expansion,” Rinkov said. “The real benefit is twofold: There is an economic benefit, with our investors driving a significant dividend return from the invested capital. And then there's something that is really unbeatable from a cultural standpoint, which is that everybody who invests capital in our expansion is now a part of the growth of that office.”

Rinkov said that having this capital structure allows Lee & Associates to remain a private company, and the intention is for the company to allocate the capital for the expansion toward growth in their respective markets. 

Lee & Associates has expanded across the U.S. During this process, Rinkov said, it has worked to stay true to its culture and support clients on a local level as well as through its platform of resources.

“We rely a lot on the entrepreneurial professionals within our offices to provide an understanding of the client, of an asset in an individual market and even of a submarket,” Rinkov said. “Since cultural integrity for us means to be broker-led, we will continue to only make decisions that we believe help brokers execute client assignments and then give greater opportunity to build wealth for them.”

This article was produced in collaboration between Lee & Associates and Studio B. Bisnow news staff was not involved in the production of this content.

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