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NEWPORT BEACH, CA—While Los Angeles, Orange County and San Diego didn't rank as high as some other West Coast markets in CBRE's Tech Thirty report, this region is simply in a different part of the cycle and will soon mature, the firm's senior managing director Kurt Strasmann tells GlobeSt.com. According to the report, Orange County, San Diego and Los Angeles ranked in the top 30 tech markets in the country at 16^th, 23^rd and 24^th, respectively, while ranking 6^th, 10^th and 15^th, respectively, in office-market rent growth—indicating that while the region has strong office markets, it still has a ways to go before being able to compete in the tech sector with markets like Silicon Valley and Seattle.

But this doesn't worry Strasmann, who says Southern California is simply in a different part of the cycle than other, more-mature tech markets. “There's a tech momentum going on in Southern California. The hub is Silicon Valley in San Francisco, but it's slowly been migrating. Certainly, West L.A. was the hub for Southern California because of the types of companies there as well as the product there. Companies like to cluster around each other, and West L.A. has seen the greatest growth in that sector.”

But, says Strasmann, Orange County and San Diego are very well positioned. Orange County specifically is a very diverse market—not one industry is dominating it, net absorption is very well rounded, and technology is becoming more important here. “Some very big development is starting to happen in Orange County. It's very slated for tech and creative-office users. A perfect example is the former Tustin marine base, Tustin Legacy, which Lincoln Property is developing, or the new Trammell Crow site in Newport Beach—this is not a traditional office building; it plays to a different sector. Also, the former Emulex campus in Costa Mesa is being repositioned for creative. A lot of product is being created for this, so technology is very well positioned in Orange County.”

Rent growth in Orange County is among the top in the nation, and Strasmann says the region is in the beginning stages of a tech boom; he expects big numbers going forward. San Diego is positioned well, too, although it is not at the same level as Silicon Valley or the surrounding markets, which are more mature. “Orange County will achieve some of the highest rent growth along the West Coast. The demand is there, and the product is starting to be built. It's not going to happen overnight, but it's the next stop as tech companies open up offices here and begin to represent a larger percentage of office activity.”

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