According to recently published research by Lee &Associates, South Orange County experienced positive net absorptionof 485,000 sf in the second quarter of 2002--the first positivequarter in two years. As a result, vacancy rates for office andflex-tech space had fallen back to 15.23% by the end of June from18.25% at the end of March.

"In recent months the office market has experienced consistentlyincreasing positive net absorption fueled by slowing constructionactivity and lower average asking rates," the report says. Theaverage asking lease rate has dipped slightly from $2.22 in thefirst quarter to $2.21 in the second quarter of 2002.

The report comes on the heels of a Voit Commercial Brokeragereport stating that vacancies have risen and absorption has droppedin the Orange County office market as a whole during the secondquarter. According to Voit's research, the total amount of officespace available in the county, including both direct and subleasespace, had increased to 16.41% by end of June from 15.71% at theend of March on 383,558 sf of negative net absorption.

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