Companies that were in an expansion mode a year ago are now taking a conservative approach because of the slowing national economy, rising energy costs and the collapse of many dot-com enterprises, according to the report.
Most of the sublease space, 1.2 million sf, hit the market in the disastrous first quarter. Net absorption fell to 389,927 sf for the first half of the year, the lowest since mid-year's negative absorption of 262,000 sf.
Some 2.9 million sf of office space was under construction countywide as of June 30, compared to about 4 million on Dec. 31. Although the construction total is lower, more than half of it has been pre-leased.
The vacancy factor jumped in Del Mar Heights from 6.3% at the end of the first quarter to 11.7% in the second quarter, mostly due to a surge in new construction.
Sorrento Mesa, hurt badly by failing dot-coms, saw its vacancy rate rise from 8% at the end of the first quarter to 20% on June 30. Eastgate Mall and Carlsbad also posted higher vacancy factors, while Mission Valley posted the strongest second-quarter absorption of all the San Diego County submarkets.
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