Part one of three
San Diego County CA— A Market View report [Link] by the CBRE Research Center shows San Diego’s office market strength was reinforced this quarter by overall sales transactions that exceeded $453 million. San Diego’s job growth beat the national average this quarter with total employment growing by more than 3 percent year-over-year, surpassing the national growth rate of 2.4 percent. The market was also strengthened by a notable volume of sales, leasing activity, strong positive net absorption and an increase in overall asking rates, according to CBRE Research.
San Diego’s unemployment rate has dropped to 5.3 percent, the lowest level since April of 2008. 39,700 jobs have been added year-over-year with jobs in professional and business services fields making up nearly one-quarter of that total. The strengthening local economy has created additional demand for office space.
“The San Diego office sales market is on track to surpass last year’s volume with tremendous activity throughout the county and especially in Carlsbad where current activity and trends project that over 25 percent of the Carlsbad office market will trade this year,” says Louay Alsadek, executive vice president at CBRE in San Diego.
The overall asking lease rates increased to $2.45, which is 6.5 percent less than the peak in Q2 2008 and the positive net absorption totaled 233,853 square feet this quarter validating the strong office market. The majority of this quarter’s positive net absorption can be attributed to substantial transactions completed in the I-15 Corridor, including Daybreak Game Co., Turtle Beach Corporation and MedImpact.
“The I-15 Corridor continued to perform very well with strong activity in the Class B sector. Given the continued strong absorption, several Class B projects have benefited with increased rental rates on lease transactions, such as Bernardo Heights Corporate Center and Bernardo Executive Center,” says Ryan Egli, first vice president at CBRE in San Diego. “
Tomorrow: Retail Market View report