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2009 ENDS WITH MORE UNCERTAINTY
The total vacancy rate has increased 60 basis points from 23.7% last quarter to 24.3%. Net absorption for the quarter was -233,500 SF, which brings the total net absorption for the year to -539,700 SF.
It is evident that tenants and landlords still do not see eye to eye with regards to lease terms which is a necessary condition for the office market to turnaround. There was 137,000 SF of leasing activity, a decline from 218,900 SF reported last quarter.
The weighted average asking lease rate decreased $0.05 to $1.92 PSF from the $1.97 PSF rate from last quarter. The decline in average lease rates demonstrates that landlords are lowering their demands in order to sign new tenants and to prevent current tenants from leaving their offices.
Although the total vacancy rate increased from the previous quarter, the Chino/Chino Hills and Corona submarkets witnessed a decline in vacancy. Corona had the greatest decline in vacancy going from 47.7% last quarter to a current rate of 41.1%. The Riverside submarket experienced the
largest increase in vacancy rising to 24.8% from 22.1% last quarter.
As market fundamentals continue to be worked out, it should be expected that 2010 will present many of the same problems that plagued 2009.
Contact Jared Dienstag at 949.724.5515 for more information.
  OFFIE09Q4.pdf
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