In 2001, the dot-com and technology storm swept through San Diego, leaving scores of buildings empty in its wake, while tenants scramble to recover losses through subleases and buyouts, according to the report. In the last 12 months, sublease availability has more than doubled, a net increase of 1.03 million sf. The battered North Cities market holds over half of this space, in addition to 2.20 million sf of direct available space.

The diminutive Carlsbad submarket posted 25.62% availability in the first quarter, offering almost 1 million sf of available space.

Consequently, average asking rents fell from $2.41 to $2.37 psf in the first quarter. Despite 8.61 million sf of available space and 651,000 sf of negative net absorption in the last quarter, San Diego remains relatively stable in relation to other major office markets and recent activity portends steady recovery, according to the report.

Total availability, while high at 16.80%, is lower than other major Californian markets. For example, San Francisco has a 20% vacancy factor, while the rate in Los Angeles is 18.73%. Leasing activity is also ramping up, the Insignia report says: tenant requirements and tours have increased substantially.

While not immediately palpable, the many leases now in negotiation will help absorb a portion of San Diego's enormous available space inventory in coming months, according to the Insignia report.