Orange County Office Investment forecast
Tech-Centric Corporations Fuel Orange County's Recovery;
Trading Improves Alongside Tenant Demand
Positive absorption reemerges. Spanning the past two years, Orange County's vacant office stock rose by 6 million square feet; however, signs of improvement have recently surfaced. During the second half of 2021, a collection of lease commitments exceeding 25,000 square feet was executed, spearheaded by a slew of agreements in Irvine. Here, satellite manufacturer Terran Orbital and electric motorbike producer Super73 subleased midsized floorplans. Bandai Namco and Hyundai-affiliated Supernal also inked direct agreements totaling 175,000 square feet. The recent rise in mid- and large-scale commitments suggests firms intend to expand payrolls in the near term, which may require them to fill additional space. This, in concert with a restrained construction pipeline and expectations for the number of office-using jobs to surpass the pre-pandemic mark, will aid properties with available square footage. Still, hurdles persist as some major employers including Irvine-headquartered Mazda have adopted a virtual-first workplace and may sublease space.