Demand for Creative Space Raises Rates

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NEWPORT BEACH, CA-High-tech tenants are seeking creative-office space in Orange County, but they are limited in their options because of short supply, reports CBRE. This demand is driving rental rates north in certain submarkets of the county, including Irvine, Anaheim Stadium Area and parts of South Orange County, where the majority of the region's tech firms are located.

Tech firms are helping drive office vacancy down in the region. As of second-quarter 2013, the largest active space requirement in the region came from a tech company looking for more than 1 million square feet, according to CBRE. Tech companies accounted for nearly 400,000 square feet of lease transactions completed during the first half of 2013.

As GlobeSt.com reported recently, the average asking full-service gross lease rate for office space per month per square foot in Orange County rose 1.6% by the end of the third quarter from $1.88 to $1.91. This is 2 cents higher than 2013's third-quarter rate, “hopefully indicating a bottom in the downward trend of asking lease rates,” says Jerry Holdner, VP of market research for Voit Real Estate Services.

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Stay tuned to the Orange County page for an update on the significance of these statistics.