The Valley & Ventura Market Starts the Year Off Slow
- The San Fernando Valley and Ventura County office market closed the first quarter with negative movement as net absorption recorded down 192,000 square feet.
- The office market vacancy rate increased by 60 basis points from last quarter to 12.4%.
- Rental rates continue to increase. Average asking rental rates increased by $0.05 from the fourth quarter to $2.55 per square foot (PSF) full service gross (FSG).
- No new projects were delivered in the first quarter, though two projects totaling 274,300 square feet are currently under construction.
- The Los Angeles County unemployment rate decreased to 4.6%, a decrease of 10 basis points from last year. Education and health services listed the largest year-over-year employment gain by adding 16,400 jobs. Professional and business services posted the second greatest growth, adding 16,000 jobs.
San Fernando Valley and Ventura County office market activity started the beginning of the year slow. Net absorption fell negative recording down 192,000 square feet in the first quarter, while vacancy increased by 60 basis points. Asking rental rates recorded $2.55 PSF FSG, a 6.7% year-over-year increase. With only two new projects under construction on the horizon, the market will remain supply constrained. Although absorption recorded negative during the first quarter, it is expected market conditions will remain positive as businesses look for lower-cost alternatives compared to the market areas surrounding San Fernando Valley and Ventura County.