Facebook's IPO Could Mean Higher Real Estate for MV

The big news of on Wednesday conjures up memories of another big IPO—Google's.

When Google went public in 2004, more than 19 million shares became available for sell at $85 a piece. By the end of the first day of trading, shares were worth $100.01. At close of business on Feb. 1, 2012, almost eight and half years later, Google stock trades at $580.

Google's IPO made many people wealthy, but according to Mountain View insiders it took a little while for all that money to trickle down even when it came to purchase homes. When Facebook shares actually go on sale to public, the effects may not be immediate either.

"I think it's going to make the real estate market shoot up again," said Elizabeth Thompson, an agent for Coldwell Banker with listings in Mountain View and Los Altos. "The exact same thing is going to happen like with Google. There will be a complete frenzy to buy property."

Thompson, whose lived in the area for 35 years, explained that she's experienced the "ups and downs" in the market and the Google IPO was an "up."

Still Thompson noted that the impact may not be so immediate because it could take some time before employees can legally sell their shares.

Another long term effects of Google's IPO has been in the creation of jobs, which consequently has led the company to purchase or lease more property, according Ellis Berns, assistant community development director .

"When Google went public, there was no immediate impact from the city's perpective that could be attributed to the IPO," said Berns. "In the long term you do see it."

But there hasn't been a "notable impact from sales tax," Berns said.

Google's presence, Berns added, may have attracted other startups to Mountain View, including and . There's "a kind of synergy" where sometimes people leave Google and start businesses in Mountain View. Mountain View currently has an office vacancy rate between 6 to 7 percent citywide and 4.5 percent downtown, according to Berns.

Commercial real estate agent Mike Cobb, doesn't see the same thing happening in Menlo Park, where Facebook recently moved its headquarters to.

"I don't think that Facebook's IPO filing will affect the local commercial real estate scene," said Mike Cobb, senior vice president at Colliers International. "They've locked up their physical expansion for years to come. They've planned for that."

Cobbs also added that neither downtown Menlo Park or Palo Alto commercial real estate will benefit from Facebook's IPO much, since most employees will likely remain on campus for food and other amenities.

But like with Google, Facebook's employee base could grow and an increase in job creation can lead to pressure on the residential market.

When Facebook founders, investors and employees do sell, Thompson – who shared that recently she had a house with 16 offers in Mountain View – expects this new wealth to increase the price of homes dramatically.

"The market's not down," she said. "It's simple economics 101: no supply and tons of demand."

"It's a great time to be a seller," she said. "It's tough to buy now, I can't imageine what it will be like then."