Both the Orange County and Inland Empire office markets saw a decrease in vacancy, an increase in leasing activity, and asking-rent growth during Q2, according to reports by Cushman & Wakefield (C&W).
The Orange County office market ended the second quarter 2018 with overall vacancy decreasing 30 basis points to 11.3 percent, C&W reports. New leasing activity saw an uptick, with just over 2 million square feet transacting in the second quarter.
For the second consecutive quarter, South County led Orange County with 63,265 square feet of positive absorption. Also, C&W says Orange County asking rents rose significantly over the last years years as a result of the delivery of multiple class-A developments and positive market conditions.
In the Inland Empire, C&W reports that overall vacancy decreased for the eighth straight quarter, down to 8 percent, a decrease of 190 basis points from a year ago, says C&W. Leasing activity was strong in all three submarkets, particularly in the Inland Empire West and the Inland Empire East, each posting over 100,000 square feet of activity.
Overall asking lease rate growth in the IE continued, especially for quality space, as rents were up to $2.27 per square foot per month for class-A product, a $0.09 per square foot per month increase from second quarter 2017. Small transactions under 15,000 square feet dominated the quarter, mainly throughout the market’s large class-B inventory, where 76,960 square feet was absorbed.