Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Redevelopment office projects are driving office leasing activity in Orange County. According to a new market report from JLL, office projects that have undergone significant renovations are capturing much of the leasing activity sparking a new adage of “if you reposition it, they will come.” While renovated space as a market segment has seen healthy leasing activity and rental rates, in the third quarter, office absorption was negative 381,719 square feet and vacancy rates remained flat at 13.9%.

“The non-traditional clients that we have, like technology and action sports, are looking for new amenitized properties,” Jeff Ingham, senior managing director at JLL, tells GlobeSt.com. “There are the more creative-style properties, which are focused on the low-rise, funky conversions, and on the more corporate side, users are looking at it from an amenity standpoint. They have food, conferencing, fitness—the whole gambit of amenities that go with the project. Those are more traditional office complexes that fit the corporate users.”

Mostly existing owners—especially institutional owners—are taking on the cost of these renovations, and it is paying off. Renovated office projects command 20% to 30% higher rents. In addition to renovated office product, there is also new construction product, which commands an 20% premium on rents as well. However, Ingham says that the two product types—renovated versus new construction—attract different users. “It is a different market, and it is really apples and oranges,” he says. “Some clients want to be in the new building and some want to be in the conversion projects. There is a big pricing difference between the new buildings, which are $4 per square foot and the conversion buildings, which are closer to $3 per square foot.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

More from this author


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.