Orange County’s research and development sector had 750,651 square feet of gross activity in the second quarter, an increase of more than 58,000 square feet from the previous quarter.
The net absorption, due to the increased activity, remained in the black, ending the quarter with 351,140 square feet.
Vacancy Rate, Absorption
Year-over-year, net absorption for research and development space was up by nearly 589,000 square feet.
The vacancy rate, due to the increased absorption, was down, dropping from 4.9% in the first quarter to now stand at 4.1%.
Average asking lease rates for research and development space continue to increase. Asking rents for the county, on average, went up 3 cents from the previous quarter and currently stand at 92 cents per square foot.
The second quarter’s average lease rates range from a low of 76 cents per square foot in West Orange County to a high of $1 per square foot in North Orange County and South Orange County.
Industrial development has started to pick up in the county, but it has yet to hit the research and development sector.
The research and development sector, with its 1,121 buildings and more than 43 million square feet of space, represents about 17% of the industrial base.
The majority of the region’s research and development space is in the Greater Airport Area and South Orange County submarkets, which account for nearly 28.7 million square feet, or more than 65% of the total market space.
North, West OC
North Orange County is the third-largest research and development submarket, with just more than 9.8 million square feet of space. West Orange County, with more than 5 million square feet of such inventory, is the smallest of the submarkets.
The county should start to see developers become more confident in building more R&D space here due to the strong demand and dwindling supply.
Data and analysis provided by CBRE Group.
Includes Real Estate Watch industry performance charts.
The Real Estate Watch Chart
Net Absorption, Rates, etc. is provided in a Adobe Reader .pdf print-friendly file.
