Orange County's industrial and office markets are showing signs of improvement in the first quarter, according to a new report from Newport Beach-based Voit Real Estate Services.
The First Quarter Market Report shows that both segments have experienced ongoing positive net absorption – aka the square feet leased in an area after deducting the amount of vacant space. The industrial market added about 800,000 square feet in the period and has posted positive net absorption for four consecutive quarters. The office market added 380,000 square feet in the first quarter. It's the third quarter in a row with positive net absorption, said Bob Osbrink, Voit's executive managing director.
“It’s been awhile since we’ve seen consistent positive absorption for both the industrial and office markets,” he said. “This is a clear indication that these markets are moving in a positive direction.”
Further signs of stability are seen in the vacancy and availability rates, said Osbrink; both sectors saw year-over-year declines in those figures.
The industrial market's availability rate was 9 percent in the first quarter, and the vacancy rate dropped to 5.3 percent. Meanwhile, the office sector's availability rate fell to 20.8, and the vacancy rate declined to 16.9 percent.
“Over the past year, the vacancy rate dropped significantly, and we anticipate this trend continuing as we move through 2011,” said Osbrink. “Additionally, we are seeing a decrease in the amount of available space being added to the market, another indication that the market is stabilizing.”
Here's a breakdown of other stats in the report:
• Industrial sales and leasing activity stood at 3.2 million square feet in the first quarter, down from the prior period.
• Lease rates held steady from the previous quarter.
• The average asking sales price rose over the previous period.
• For the office market, sales and leasing activity totaled 2.6 million square feet, unchanged from the same time in 2010.
• The average asking full-service lease rate per month dropped from the prior quarter.
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