Research & Forecast Report - Inland Empire
The total vacancy rate for the Inland Empire office market increased 160 basis points in the second quarter of 2019 to 12.6% from 11.3% last quarter. The increase in vacancy stemmed from negative movement in the Rancho Cucamonga (up 330 basis points), Riverside (up 170 basis points) and San Bernardino (up 130 basis points) submarkets. The quarter closed with absorption recording negative 269,600 square feet, while leasing activity recorded 344,500 square feet, a number that ranks above the three-year average of 285,800 square feet.
The weighted average asking rental rate increased $0.03 during the second quarter to $1.88 per square foot (PSF) full service gross (FSG). For a historical perspective, one year ago the asking rental rate recorded at $1.79 PSF FSG.
One of eight submarkets in the Inland Empire office market witnessed positive net absorption, with Ontario recording the greatest at 10,400 square feet. All building classes recorded negative absorption with Class A recording the least at negative 78,200 square feet for the quarter, while Class C had the most negative absorption at 96,200 square feet.