Research & Forecast Report Inland Empire
The total vacancy rate for the Inland Empire office market decreased 10 basis points in the first quarter of 2019 to 11.3% from 11.4% last quarter. The decrease in vacancy stemmed from movement in the Coachella Valley (down 130 basis points) and Riverside (down 90 basis points) submarkets. The quarter closed with absorption recording positive 16,400 square feet, while leasing activity recorded only 197,800 square feet, a number that ranks below the three-year average of 262,700 square feet.
The weighted average asking rental rate increased 1.1% during the first quarter to $1.85 per square foot (PSF) full service gross (FSG). For a historical perspective, one year ago the asking rental rate recorded at $1.77 PSF FSG.
Five of eight submarkets in the Inland Empire office market witnessed positive net absorption, with Riverside recording the greatest at 30,000 square feet and Ontario recording the lowest at negative 30,700 square feet. Among building classes, Class B office led net absorption at 37,800 square feet for the quarter, while Class C had the lowest quarterly absorption at negative 52,900 square feet.