Can Absorption Keep Pace With Deliveries?

SAN DIEGO—With 776,309 square feet of office space delivered in San Diego during Q2 and more than 1.6 million square feet under construction, according to Colliers International‘s Q2 office report, will absorption keep pace? The report indicates that demand year-to-date has been keeping pace with new supply, with net absorption totaling just over 738,000 square feet. But will this absorption pace continue?

Marc Posthumus, VP with Colliers, believes it will. “Absorption will continue to keep pace, since this expansion cycle is vastly different from the last because there is still very little true speculative construction,” Posthumus tells GlobeSt.com. “In the last cycle, developers were in a mad rush to get office developments out of the ground, and now they are cautiously optimistic.”