News

TENANT DEMAND SURGES; FIRMING FOR SLIDING RENTS Strong countywide demand for industrial space returned in the third quarter with the most tenant growth for any three-month period since late 2022. A long slide in overall rents also came to a halt. Net absorption totaled 824,188 SF in Q3. There has been positive overall tenant expansion of 1,440,309 SF in three of the last four quarters – a relief for landlords following 11 straight negative quarters…

OFFICE RECOVERY CONTINUES, RENTS HIT NEW RECORD Healthy tenant growth continued in the third quarter with companies leasing nearly a half-million square feet of space. Steady gains in demand have pushed the vacancy rate down to 13.4% from its 16.1% peak reached three years ago and is slightly less than the nationwide average. Asking gross rents are up 10% year over year, averaging $2.93 per SF, the highest on record. Positive net absorption in the…

STRONG DEMAND CONTINUES; LOW AVAILABILITY AND HIGH RENTS Strong demand for space continued in the third quarter, with the rates of vacancy and available space at all-time lows while Orange County rents remain among the highest in the nation. Healthy growth among merchants and entertainment providers also pushed third-quarter occupancy to a record 75,592,120 SF or 96.6% of the 78,119,730-SF base inventory. Third-quarter net absorption totaled 96,710 SF, bringing year-to-date retail expansion to 345,243 SF…

VACANCY IS LOWEST SINCE 2019; OC RANKED SIXTH COSTLIEST Strong merchant demand in the second quarter drove down the countywide vacancy rate to 3.5%, the lowest since 2019. Second-quarter net absorption totaled 177,260 SF. Available space hit a near decade low of about 2.63 million SF, or 3.3% of the 79.1-million-SF inventory. Sublet space available in Q2 totaled 152,106 SF, down from 418,627 SF in the last two years. There are 21 properties under construction…

DEMAND SPUTTERS, VACANCY GAINS, SUBLEASES HIT RECORD After two quarters of positive net absorption, tenant demand fell into the red in the second quarter and has been negative for 12 of the last 14 quarters. Also, space available for sublease hit a record, the pace of development has cooled and the overall vacancy rate is the highest in 15 years. Countywide second-quarter growth was negative 227,986 SF with the Airport and South County markets reporting…

TENANT GROWTH SURGE CONTINUES; SUBLET SPACE SLASHED The office market in the second quarter continued its strong recovery from the Covid freefall. The vacancy rate dropped below 13% for the first time since 2021. Available sublet space has been cut in half and is at its lowest in seven years. Countywide net absorption hit 346,503 SF in the second quarter, bringing the mid year total to 701,266 SF. Net absorption has been positive for 10…

VACANCY FALLS TO LOWEST LEVEL SINCE THE LOCKDOWN The countywide vacancy rate fell in the first quarter to 3.8%, the lowest level since the Covid lockdown five years ago. Available space in Q1 hit a near-decade low of about 2.8 million SF, or 3.6% of the 78.9-million-SF inventory. Sublet space in Q1 fell to 92,364 SF, down from 418,627 SF in the last two years. Well-located vacancies fill quickly. Institutional-quality space is tight, and most…

MODEST DEMAND RETURNS IN Q1 AFTER RENTS SLIDE 12% Positive net absorption returned countywide for the second straight quarter, led by modest tenant expansion in the Airport and West County submarkets. The recent overall growth follows 11 consecutive quarters of declining user demand totaling -9.5 million SF amid increasing supply. The countywide vacancy rate was pushed up from a record low  of 1.8% to 6.6%. The nationwide average is 7.5%. Since 2022, 5 million SF…

TENANT GROWTH TREND CONTINUES AMID SHRINKING SUPPLY Healthy tenant demand continued in the first quarter that also saw further inventory reductions from redevelopment and owner-users buying buildings at deeply discounted prices. Countywide net absorption totaled 198,474 SF in the first quarter and follows two years of tenant growth totaling 2.2 million SF, the most since the Covid lockdown. But leasing activity remains about 10% less than prior to the pandemic. The Q1 growth was led…