The Market Thrives
San Mateo County continues to show its strength as the hottest market on the San Francisco Peninsula. All industries appear to be wrestling with the limited amount of available space in San Mateo County. It is very easy to say that the tightest market belongs to industrial space which report vacancies of 1.50 percent this quarter. However, the research and development (R&D) sector is not far behind ending the quarter with a vacancy rate of 1.80 percent. This quarter, office space noted a vacancy rate of 6.86 percent, which is slightly lower than previous quarters. While it may seem that office space within San Mateo County is more readily available, it is definitely just as limited with the average asking rents reaching $5.18 fully serviced per square foot.
The average asking rents for both industrial and R&D product have been climbing to exceedingly new heights. The industrial market recorded an asking rate of $1.47 NNN, a 19.50 percent increase in rent over the past year, while the R&D market ended the quarter at $3.79 NNN, which was an 18.44 percent increase. As more buildings are developed on the San Francisco Peninsula, we hope there will be more available space to ease the market as the San Francisco Peninsula remains a strong, thriving market.
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