Skip to main content

Scroll Down

Market Report

San Diego Office Market Report

2024 Investment Forecast

Record Delivery Volume and Elevated CBD Vacancy
Distract from Encouraging Demand Elsewhere

Downtown braces for supply influx. Despite a 12-year high vacancy rate, San Diego’s office sector is expected to record the largest annual inventory growth rate among major U.S. markets during 2024, at 3.2 percent. Local deliveries, however, are not widespread. Upcoming completions are concentrated in Downtown San Diego and to a lesser extent the Del Mar Heights-Carmel Valley area, part of the I-5 Corridor. In downtown, a collection of large-scale speculative projects, including the delayed Campus at Horton and a group of buildings along the bayfront, will grow the local office stock by a significant 20 percent. This is likely to push the submarket’s vacancy rate beyond 30 percent, which would rank as one of the nation’s highest CBD rates. Outside of downtown and the I-5 Corridor, however, collective vacancy should be less pronounced, as it entered the year at roughly 13 percent. The lack of near-term deliveries in these suburban areas, specifically the metro’s two largest submarkets of Central and North San Diego, should steer prospective tenants to existing spaces, supporting occupancies.

Related Research

Back to top