REAL ESTATE : High Office Vacancy Rate in County Means a Catch-Up Game, Survey Says

It will take nearly four years for developers to find tenants for all the vacant office space existing or being built in Orange County today, according to a recent survey.

Tenants have been grabbing up local office space rapidly, leasing 3 million to 4 million square feet a year. But nearly 16 million square feet of office space in the county is either vacant or under construction, according to the survey commissioned by Burke Commercial Real Estate in Irvine.

Vacancy rates in the 20% range mean developers have not been able to raise rents this year, according to the survey, with rates stuck at about $1.80 per square foot. The survey covered 676 office buildings in the county.

On the positive side, office buildings are expected to continue to rent well through 1988, said Burke Commercial’s consultant, the Research Network in Laguna Hills.

“In the short term, increased vacancy rates in all areas of the county are expected,” said Matt Disston of Research Network. “However, if (rental) activity stays at the current level and lease rates remain stable, the overall vacancy picture should begin to improve by 1988.”

Where are all these new office buildings going up? The survey found the greatest construction activity in the area of John Wayne Airport, where 3.6 million square feet of office space was under construction through the first nine months of the year.

Central Orange County was a close second, with about 3.5 million square feet under construction. Most of the building was in the Anaheim Stadium area.