The Tipping Point
The Northern California's Central Valley office market vacancy rate increased slightly to 10.7 percent at the close of the third quarter. Available Class A office product decreased 160 basis points to 13.4 percent, pushing average asking lease rates up to $1.97 per square foot, full service gross. The vacancy rate for Class B product increased to 10.5 percent with 35,067 square feet becoming available at 110 East Weber Street after Bank of America vacated the building. Average asking lease rates for Class B office space remained flat from the previous quarter. The vacancy rate for Class C office product decreased slightly by 20 basis points to 3.9 percent and average asking lease rates remained at $1.18 per square foot, full service gross. Construction completed at the 306,000 square foot Stockton Courthouse this quarter after major delays during the inspection process. Net absorption for San Joaquin County during the third quarter totaled 257,883 square feet, increasing the year-to-date net absorption to 304,054 square feet.