Sales volume increases as tenants try to work around tight leasing conditions in Orange County
Orange County remains a landlord’s market but tenants and buyers are working around the persisting tight market conditions, especially when searching for large spaces.
April 23, 2019
- Orange County remains a landlord’s market but tenants and buyers are working around the persisting tight market conditions, especially when searching for large spaces. Total market activity is essentially stagnant when comparing total square feet leased and sold this quarter to the quarter prior. But, activity shows mixed trends when you look at sales and leases separately, especially when building size is taken into account.
- In Q1, there were 8 more leases signed than in Q1 2018 however, total square feet leased has actually decreased signaling greater activity among spaces in the smaller size range. In fact, lease volume for properties greater than 50,000 square feet has decreased by 61.3 percent.
- On the other hand, sales activity shows completely opposing trends. There were 11 more sales signed last quarter but total square feet sold has increased by 68.8 percent this quarter.
- As competition remains high especially for tenants looking to have a large footprint in the market, industrial users and investors are quick to purchase large properties given the lack of availability, intense demand and great margin for profit.
Source: JLL Research