Vacancy Grows, Deal Velocity Slows
San Mateo County’s commercial real estate market was muted in the last quarter of 2020. Gross absorption, which is defined as non-renewal leasing and user-sale activity, for office, R&D, and industrial assets amounted to just 540,000 square feet in Q4 2020, down 68.5 percent compared to Q4 2019. As deal velocity slowed, vacancy ticked up resulting in quarterly occupancy losses of roughly 549,000 square feet. At the end of 2020, the vacancy rate market-wide stands at 7.1 percent, up 180 basis points year-over-year.
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