San Francisco Bay Area Remains Top Performing Economy and Destination for EB-5 Investment

February 21st, 2023 Colin Behring

The economy is top of mind for real estate investors and especially EB-5 investors. For immigrant investors seeking a green card through investment, it is more important than ever to make a solid decision on your EB-5 project and EB-5 partners. There is so much more to consider now in light of the new 2022 RIA policy, such as visa set-asides, investment options for urban HUA locations vs. rural locations, and strong regional center platforms that meet the demands of EB-5 3.0. How can an investor ensure approval of their EB-5 application? How does an investor ensure EB-5 job creation, a return on investment, and ultimately, the repayment of capital? It starts with a great location, a great asset, and a great management team.

Behring operates its EB-5 regional center and real estate private equity platform in California, specifically in the San Francisco Bay Area. So how is California doing in this post-COVID world? Before the COVID pandemic, California was a massive favorite. It was the #1 location for venture capital investment and a top commercial real estate location for institutional investors worldwide. And EB-5 investment flowed in the same direction. What about today? Are the hate-filled headlines talking up a “California Exodus” true?, or is it just EB-5 competitors doing anything they can to stop losing to California projects? Is it possible that California is no longer the Golden opportunity it once was?

There is only one way to settle this. Data.

If you want truth, we need to look at the data. Not a random Internet headline, not with hastily written blogs with no objective data support, not from opinion based on lazy over-generalizations. Numbers don’t lie, and if you look at relevant data in the correct context, you can come to sound conclusions.

So How is the San Francisco Bay Area doing?

  • In 2022, the Bay Area ranked #1 in in GDP growth with 4.8% growth, a nominal $1.3 trillion. Those numbers are thriving, well-rounded, uninhibited economic growth. SF Bay Area is #1 still after 3 years of the Covid pandemic and the alleged population exodus, which also proved false. As a comparison, Florida only has 1 metro that hit the rankings for growth: Orlando – heavily revolving around Disney and the fact that it was 2022 and you are allowed to actually go in the parks, and that ranked 10th in the nation with only $246 billion or just 17.79% of the San Francisco Bay Area’s production.

  • In full year 2021, the Bay Area ranked #1 in venture capital investment. We pulled in over 34.8% of all venture capital in the entire country, nominally reaching over $94 billion. Multifamily investors like looking at new VC money as a benchmark because more VC funding turns into more hiring, which in turn leads to more spending and higher rents. Historically, venture capital fundraising activity is a leading indicator of strong employment growth in high-paying information and professional/technical service sectors, which includes many high-tech firms. Simply put, Venture funding turns into job creation and economic growth.

  • In the first half of 2022, (most current data we had access to), the Bay Area ranked #1 in venture capital investment again, pulling in $52.4 billion. Media likes to talk about the surge from Austin as a new tech hub, but looking at the numbers, Austin still has far to go… Austin raised $3.4 billion which is 15x less than the San Francisco Bay Area. All of Southeast Florida, on the other hand, ranks dead last out of the top 10 metro areas, with only $2.5 billion in VC money.

  • SF Bay Area Job Creation is HOT, recording 12 consecutive months of net job growth throughout 2022. Tech layoffs did not put a dent in the big picture. All the tech layoffs that take over headlines didn’t put a dent in job creation because of how robust the Bay Area economy is. In December 2022, the Bay Area powered big job gains,adding a net 13,600 jobs and a jaw-dropping 84% of California’s statewide total. In the reports, even Governor Gavin Newsom praised the overall strength of California’s economy, and “December 2022 closed out a year of consecutive monthly job growth.” it was an especially strong announcement when so many people were focused on big tech layoffs. California haters would love to see the “King” fall, but again, the data is proving otherwise. It is an age-old adage in media that “Hiring is back page news; Firing is front page news.” Again, this is a learning moment to not just read headlines but to look at the relevant data that fully describes the real activity.

  • The California Exodus was a popular media talking point, but fell flat in the context of economic strength. According to the Public Policy Institute of California, for California as a whole, there is a trend of older low-earning residents leaving the state, while it continues to attract younger high-earning new residents. Also, California has always benefited from international immigration, but the pandemic stopped those inbound resident moves. 2023 should see this number normalize and a growth trend is largely expected to resume as shown by moving van data on inbound/outbound bookings converging after two years of divergence. Some critics of California grasp onto media headlines talking about a drop in San Francisco residents. Generalizations can be the death of a successful investment for someone who falls for empty comments that takes reality out of context. A sober and deep reading into the data and offer the real picture on migration. San Francisco has in fact lost residents, but while most were low-earning or retired to begin with, the ‘total’ actual San Francisco residents made up a small portion of the Bay Area workforce anyway. Census data showed that over 44% of the entire Bay Area workforce (including Silicon Valley) lives in the East Bay, including Oakland, and that was even pre-Covid. Just across the bridge from San Francisco, Oakland actually gained 3.4% population since 2020 and has been growing 1.1% annually. Net population growth, no exodus, full-stop.

In summary, the San Francisco Bay Area macroeconomic performance is still incredible and leading the nation. In this era of click-bait tactics to draw attention where e media world, “change gets clicks”, the narrative of a “California exodus” or any “fall from the top spot” is more grabby than “California dominates economic growth categories again”.  Behring reiterates that you have to look at the data in correct context and know the motivations behind those spreading “bad” data reading to come to a viable conclusion for investment. And we invite you have a deeper conversation with the Behring team to discuss the San Francisco Bay Area and the strength of the real estate fundamentals.

Oakland Demographics, Economics and EB-5 Investing Prospects

Behring’s expertise lies in the urban multifamily markets in the Bay Area and specifically in Downtown Oakland, directly on the BART transit lines. How is Oakland doing recently? Oakland is growing, becoming wealthier and is more financially powerful than anytime in its history:

  • Oakland’s population grew at 3.4% since 2020 even throughout the COVID pandemic. Net Growth. No exodus. Full Stop.See the details here.

  • San Francisco Salary Earners Live in Oakland.  Over 44% of the entire Bay Area’s workforce lives in the East Bay, including Oakland. San Francisco has high density office clusters but population density for place of residence is clearly outside San Francisco.

  • High income households earning $150,000 per year increased 175% from 2015 to 2020.

  • The proportion of Oakland renters earning $150,000 or more increased from 12% to 26% of population from 2011 to 2020. expects that by 2026, proportion of households earning $150,000 or more will reach 31%, which is a 147.6% increase from 2011.

  • Oakland’s renters are more financially healthy than ever. The number of households spending 20-29% of income or less on rent increased 5,382 households or 83% compared to 2015. Even stronger households that spend less than 20% of income on rent increased 7,356 households or 55%.

  • Oakland’s Class A Tower demographics are some of the strongest in the entire country. In October of 2022, while we were conducting due diligence on an acquisition in Downtown Oakland, Behring reviewed records showing that an entire tower was full of clients that had average income surpassing $290,000 per year, average age was just 29 years old and the income-to-rent ratio was just over 13%.

  • Oakland’s current construction pipeline is running completely dry because of COVID, supply chain disruptions and slowdown in financing markets. Oakland’s downtown core foresees delivering only 3,000 apartments until 2026. Any project in lease-up will have no new competition during the most critical cash-flow chasing moments. This limited and highly constrained supply describes why the Bay Area remains such a stable and reliable performing investment market. Massive oversupply creates plummeting occupancy rates, reduced revenue and ultimately distress for markets. Oakland will have highly restricted new supply only delivering around 1,000 units per year for the next few years, all while growth in net demand is over 1,800 units per year.

  • Demand will vastly exceed supply through 2026. Research by The Concord Group suggests that the downtown core will have demand for about 8,105 new residential units. Compared to the 3,127 apartments expected to deliver, the Oakland market will be short 4,978 units. Any new Class A residential building will have nearly 5,000 renters fighting for units that are already occupied.

  • Mortgage interest rates increased making renting a far more attractive alternative versus buying.

Behring maintains its bullish opinion of the multifamily investment in the San Francisco Bay Area and particularly in Downtown Oakland. Demographics are strong between GDP growth, high-income household formation, renter affordability increasing in capacity. And local supply/demand dynamics are hugely supportive of accelerated rent growth for 2024 and beyond.


Behring’s flagship EB-5 Investment at 1900 Broadway in Oakland, California is a testament to what EB-5 investing should be: guaranteed job creation, USCIS approvals already in hand and a trophy quality asset to secure the EB-5 investor capital.  To learn more about Behring real estate or EB-5 immigration investment opportunities, make an appointment to speak with our experts now.