The Office Market
West Orange County is the smallest of the office submarkets, with 5% of the total net rentable office space in Orange County. The West Orange County market area performed well throughout 2000, with steadily tightening vacancy rates and four quarters of positive net absorption. Nearly 16,000 square feet of office space were absorbed in the fourth quarter, pushing the annual net absorption to a three-year high of 176,862 square feet. The high absorption in the small market pushed the vacancy rate down from 11.3% to 7.4%, the tightest office vacancy in the county at year-end. In response to the tightening market, the average asking lease rate for office space in West Orange County rose 4 cents in the fourth quarter to end the year at $1.68 per square foot per month. Construction of the Warland/Cypress Business Center continued through the fourth quarter with completion in the first quarter.
Industrial Market
The majority (85%) of the West Orange County industrial market consists of manufacturing and warehouse product. Along with the surrounding industrial market areas in the county, West Orange County remains a tight market with an overall availability rate of just 5.2%. Actual industrial vacancy in West Orange County dropped to a low of 1.7% by the end of 2000. The vacancy rate for research and development space dropped to 6.1% in the fourth quarter, while the tighter M & W; market fell below 1% by year-end. Both sectors of the industrial market experienced positive net absorption in the final quarter of the year, pushing the total combined annual absorption for 2000 to more than 1 million square feet. The average asking lease rate for industrial space in West Orange County rose 1 cent in the fourth quarter to 58 cents per square foot per month, up 3 cents from the same quarter last year. Construction activity in West Orange County was divided, with four R & D; and four M & W; buildings under development at the end of the year.
The Retail Market
As with the office market, West Orange County makes up a small portion of the county’s retail base, accounting for approximately 12% of OC’s gross leasable retail space. Although relatively small, the retail market in West Orange County held strong with the other submarkets through 2000, reporting a vacancy rate below 8% at the end of the year. Specialty centers remained the strongest sector in the West County retail market, with a vacancy rate of less than 1% and an average asking lease rate in excess of $2.00 per square foot per month. The average asking lease rate for all retail space in West Orange County fell 1 cent to $1.65 in the fourth quarter, however that still was a 20% increase over average rent at the end of 1999.
