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Market Report

Riverside-San Bernardino Office Investment Forecast

2020 Outlook

Health and E-Commerce Expansions Support Office Demand; Buyers Target Central and Outlying Locations

 
Vacancy tight as expanding firms align with limited construction. A growing base of older residents and a strong rate of household formation have increased demand for health services in the Inland Empire over the past four years, influencing medical providers and insurers to bolster their local office presence. At the same time, firms that support the region’s e-commerce and logistics industries also expanded, aiding overall leasing velocity. The resulting decline in metro vacancy was accompanied by limited office construction, highlighted by minimal speculative development. This year, three projects, two of which are build-to-suit, account for most of the space finalized. The lack of newly built, available floor plans coupled with the creation of 5,000 traditional office positions support steady demand for space in 2020, holding vacancy below 10 percent for a third consecutive year.

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