At the start of 2010, there was less than 500,000 square feet of commercial space under construction in Orange County.
Construction has significantly declined, which is mainly in response to the economic uncertainty facing the nation. The decline can be seen in all types of buildings, but most significantly in the office and retail segments, which have no construction to speak of.
Industrial development remains low in comparison to previous years, mainly due to a lack of available land—which is leading developers to redevelop existing structures.
North County carries all of the construction totaling nearly 500,000 square feet. The Canyon Point Center in Anaheim has a total of three buildings that broke ground in the third quarter and are expected to be completed this year.
The majority of the submarket’s construction is a 375,000-square-foot building preleased to Northgate Gonzalez Markets, an Anaheim-based Hispanic grocery store operator.
After hitting a construction peak in late 2006, the days of OC office market’s record-high construction are a thing of the past. Following the minimal construction that occurred in 2009, there was zero development of speculative space in the first quarter.
The 2010 pipeline does include one building in Anaheim. Construction of a 194,000-square-foot building is scheduled to begin this quarter, which is a build-to-suit project for the use of its owner, Extron Electronics Inc., which is expected to occupy the building by 2011.
Developers are keeping a cautious eye on the market and have put plans for development on hold causing construction in OC to come to a screeching halt. Several projects have been put on hold until the economy regains stability, while others are on hold indefinitely.
Data and analysis by CB Richard Ellis Group Inc.
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