January 7, 2016
Voit Real Estate Services was among the first to close the books on 2015 and issue its Fourth Quarter Market Report, which further verifies that the firm’s recovery forecast for the past 12 to 24 months is, in fact, a reality in OC.
The tent poles supporting 2015 improvements in OC’s office sector are:
- 850,000 square feet of positive annual net absorption
- 11 consecutive quarters of rising lease rates
- Average asking lease rates of $2.26 (fsg), up 18% from 2014
- Direct/sublease space vacancies dipping to 10.78%.
Voit’s Jerry Holdner predicts an increase in office construction, because “typically the cranes come out when vacancy dips below 12%.”
The industrial market also made big strides in 2015:
- Six-percent (9.5%) increase in asking lease rates
- Significant drops in both vacancy and availability
What’s most striking is that over the last three years vacancy dropped 37 percent, while availability decreased 23.2 percent. The fourth quarter ended with a vacancy rate of 2.33 percent, the lowest rate ever recorded. (The record low rate recorded for availability was 4.29% in the fourth quarter of 2005.)