While some office markets are beginning to show signs of life, office demand in Solano and Napa Counties has continued to falter. The vacancy rate in the two Northern California counties increased from 17.5% to 17.8% in the second quarter, illustrating the sluggish market activity, according to a market report from Colliers. With class-A vacancy seeing a more dramatic increase, from 19.2% to 20%, the report forecasts rising vacancy through the end of the year.

The vacancy rate is just one sign of the slow market activity. Absorption was in the red 12,312 square feet, while direct asking rents remained flat at $1.97 per month, full-service gross. One positive note: the sublease supply decreased for the first time since the start of the pandemic by 18.2%. The total sublease supply in the market is 59.829 square feet. In early 2020 before the start of the pandemic, the sublease supply was 16,771 square feet.

In Fairfield, the office vacancy rate increased from 27.6% to 28.9% as a result of limited leasing activity, according to the Colliers report. The largest investment transaction was BAU Courage LLC's purchase of a 42,670-square-foot office/flex building located at 2333 Courage Drive for $4.7 million. The property was 60% leased at the time of the sale.