Orange County’s retail sector has yet to see a significant increase in development. There have been multiple projects taking place within the region, but the areas of large retail development continued to remain scarce in the second quarter.
No large developments have been announced this year, but construction continues on the regional center named The Source in North Orange County. The center has more than 400,000 square feet under construction and is projected to be completed before the start of this holiday season.
Construction activity in the office sector remained comparatively low, even as the market gained momentum.
The majority of the office development that’s occurred has been build-to-suit projects. Pacific Investment Management Co. completed construction on its 380,000-square-foot headquarters in the second quarter.
There are currently 484,852 square feet under construction, including the Irvine Company’s building at 520 Newport Center Drive, a top-tier, class A, high-rise building in Newport Center that’s expected to have some of the highest asking rates in Orange County.
Also being built is the 110,000-square-foot Impac Center in Irvine and a new, low-rise building at the Koll Center in Newport Beach. A significant amount of additional planned development remained in the pipeline. That included the Tustin Legacy project on the former Tustin air base that has been given 2.5 million square feet of office entitlements.
No additional construction starts occurred in the OC industrial market by the close of the quarter.
Construction in Anaheim continued on the 93,000-square-foot building at 4850 La Palma Ave., as well as 864,794 square feet at the Anaheim Concourse. 17332 Gothard St. in Huntington Beach is under construction, consisting of two buildings totaling 144,754 square feet.
Orange County industrial development has been stagnant for the past several years. The industrial base is shrinking in the county with residential conversion and development, a growing trend due in part to the high cost of land.
Several industrial development plans are in the pipeline that should help raise the low availability in the next 12 to 24 months.
Research and analysis provided by CBRE Research
