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Market Report

Riverside-San Bernardino Office Market Report

2Q 2022

Demand for Low-Cost and Medical Office Space
Supports West Coast’s Lowest Vacancy

Inland rents and expanding labor pool appeal to thrifty firms. Riverside-San Bernardino entered April as one of two major U.S. markets with a sub-10 percent vacancy rate. On the surface, the metro's regionally discounted asking rents are attracting more smaller and mid-sized businesses intent on lowering their operating costs. This movement translated to strong Class B/C leasing. During the past year ended in March, tenants absorbed a net of 780,000 square feet, dropping subsector vacancy to a record low. Additionally, the Inland Empire has a significantly smaller volume of inventory per traditional office-using employees than most metros. This limits options for expanding firms and those with upcoming lease expirations, a boon for renewal activity and vacant floorplans. Looking ahead, the metro's growing labor pool represents an additional attractant, allowing conditions to remain among the nation's tightest.

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