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VACANCY CONTINUES TO RISE AS LEASING ACTIVITY DECREASES AGAIN
The San Fernando Valley & Ventura County office market saw total vacancy rates increase an additional 40 basis points to 18.3% as net absorption was -123,600 SF in Q3. Although the rate of space givebacks continued to slow for the second consecutive quarter, vacancy levels are already at the highest level since the dot-com bust earlier this decade.
The direct weighted average asking rent decreased for the sixth consecutive quarter to $2.37 per square foot, per month Full Service Gross (FSG) which is the lowest average asking rental rate seen market-wide in almost three years. On the other hand, the small decrease in rents relative to what has been seen over the past 18 months may be a sign that the decline in rents may be moderating.
Leasing activity decreased 31% over last quarter to 439,100 SF as area companies only take space they absolutely need for the time-being. While the amount of space givebacks and the increase in office vacancy were lower than expected considering the sharp rise in vacancy levels seen at the
beginning of the year, until area companies begin hiring again, market fundamentals are expected to remain relatively weak well into 2010.
Contact Michael Soto at 213.532.3220 for more information.
  OFFSFVVC09Q3.pdf
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