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Suburban Rents, Vacancy Surpass Downtown

SAN DIEGO-San Diego proves it’s still a suburban-office town; downtown market continues to suffer while some suburbs enjoy single-digit vacancy, JLL executives tell GlobeSt.com.

By Carrie Rossenfeld | Updated on June 11, 2012

SAN DIEGO-When you consider most downtown commercial real estate markets, particularly on the West Coast, San Diego is the antithesis of the norm. While the downtown submarkets of San Francisco, Seattle and the Silicon Valley are experiencing promising recoveries, just the opposite is true here. In fact, Jones Lang LaSalle executives tell GlobeSt.com that certain suburban submarkets are surpassing downtown’s fundamentals with single-digit vacancy rates and higher rental rates than downtown.

Part of the reason for this phenomenon is the nature of office and industrial users here, Bob Prendergast, managing director in the capital markets area for JLL, tells GlobeSt.com. “Capital flows where the tenants go, and San Diego tenants don’t want to be downtown.”

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