Search
 

Burnham Researchers Predict R&D Improvement by Year-End

SAN DIEGO-Although still sluggish compared to San Diego County's industrial market, the R&D sector is supposed to pick up by year-end, according to Burnham Real Estate researchers. Vacancy currently stands at 17.1%, with a year-to-date net absorption of negative 116,465 sf.

By Erin Cassin | Updated on August 15, 2004

SAN DIEGO-Although still sluggish compared to San Diego County’s industrial market, activity in the region’s R&D sector is supposed to improve by year-end, according to Burnham Real Estate researchers. New data published by Burnham puts year-to-date activity for the county’s R&D market at negative 116,465 sf, which has caused vacancy rates to slide up from last year. According to the report, vacancy has increased from 14.4% for total leasable space at year-end 2003 to a current level of 17.1%. When owner-user space is included, vacancy was 10.4% at the end of last year and is now recorded as 13.3%. Mickey Morera, a senior vice president and industrial leasing specialist with Burnham, attributes the increase in R&D vacancy levels to “corporate consolidations and a flight to class A buildings.” He tells GlobeSt.com that “it’s the lagging effect of some corporate consolidations that have occurred in 2003 and they’re finally getting around to putting space back on the market now.” Additionally, “some of the office users that were in R&D facilities for economic reasons have jumped over to true office buildings to take advantage of the concessions there.” Despite the R&D market’s overall languid state, this sector has been showing some signs of life. For the second quarter of 2004, a total of 46,839 sf of R&D space was absorbed and Morera predicts “a firming up of rents by the fourth quarter of 2004.” He also notes that “we will probably start seeing some flex, two-story, R&D/office product being constructed by some of the savvier developers starting by the fourth quarter of this year.” Already, several R&D projects are under way in the county, including Biosite’s 350,000-sf first phase of its new 800,000-sf corporate headquarters in Sorrento Mesa’s Fenton Technology Park and Biogen Idec’s 167,000-sf R&D building that is rising next to its office building in North University City.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.