It is no surprise that with hardly any new construction on the horizon in West Orange County, the trend of increasing lease rates continued in the third quarter.
The average asking lease rate for the quarter increased to 65 cents, triple-net, per square foot. That’s a jump of 8.3% over the third quarter of 2013.
Vacancy Drop
Year-over-year, the vacancy rate has dropped from 4.3% to 2.2%.
And, more specifically, Garden Grove has reached a record-low vacancy of 0.7%, while Huntington Beach has dropped to 1% vacancy.
Also, similar to previous quarters, West Orange County continued to have rising sale prices due to the decrease in vacancy and lack of availability. Year to date, the market has experienced 383,141 square feet of positive net absorption.
Morgan Stanley welcomed a new 36,060-square-foot tenant, Fisher & Paykel, and a new 28,800-square-foot tenant, TYR Sports, to its Garden Grove portfolio.
Also, the latest owner-user sale was completed at a 30,817-square-foot building in Garden Grove at just more than $128 per square foot.
The only new construction we continue to have in the submarket is the development of two state-of-the-art buildings in Huntington Beach by Shea Properties that have an expected completion date of next May.
Goodmanson is a senior vice president, and Schneider is an associate analyst with CBRE.
