July 7, 2017 Comments Off on What’s Driving Office Demand? Views: 774 California News, Orange County

What’s Driving Office Demand?

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The Orange County office market has recorded positive net absorption for six consecutive years, largely as a result of strong job growth. The latest JLL Q2 2017 office market report found additional factors contributing to a sustainable economic expansion included increased housing supply, which is attracting start-ups and mature firms to the market.

The Central OC market is leading the region with tenant demand because of the submarket’s affordable rents. The report showed during the first half of 2017, Central County recorded more positive net absorption (379,479 square feet) than the entire Orange County market (182,054 square feet). Rising rents in the Airport Area and South County are driving tenant movement to Central County.

Despite delivering 636,244 square feet of office space in the Irvine Spectrum since Q1 2016, vacancy remains low at 7.6%, and new developments are 86% leased.

Key OC fundamentals:

  • Four million square feet office under construction
  • Total vacancy holding steady at 11.5% (15.3% in 2013)
  • Average asking rents increased to $2.71-per-square-foot

Read more at JLL Research

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