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Office is Stronger Than the Numbers Might Suggest

With 2016 seeing massive office absorption, leaving little available space for lease in 2017, it only seems as if the sector paled in comparison to industrial and retail’s robust numbers, CBRE’s Matt Carlson tells GlobeSt.com.

Matt Carlson Carlson: “[Office is] not as tight as retail and industrial, but it never gets tighter than those other sectors.”
SAN DIEGO—With 2016 seeing massive San Diego office absorption, leaving little available space for lease in 2017, it only seems as if the office sector paled in comparison to industrial and retail’s robust numbers, CBRE SVP Matt Carlson tells GlobeSt.com.

The firm’s Q4 2017 office reports reveal that the San Diego office asking rate fell slightly by $0.01 (-0.2%) quarter-over-quarter but increased $0.06 (+2.3%) year-over-year and that vacancy increased slightly by 30 bps in Q4 2017 to 11.3%. The rate has remained below 12% for five consecutive quarters.

Also, the net absorption was negative (154,006) square feet in Q4 2017 after five consecutive quarters of positive absorption. Year-to-date absorption was 482,241 square feet. Two new office projects broke ground in Q4 2017—the Watermark in Scripps Ranch and Lift in Carlsbad—adding space to the market.

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Carrie Rossenfeld

Carrie Rossenfeld

Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.

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