Orange County Office Development : WE’RE PLANTING FEWER ORANGES, MORE SKYSCRAPERS
They used to call Orange County a bedroom community for Los Angeles. Anyone who still harbors that misconception is invited to drive east on I-405, past South Coast Metro and John Wayne Airport, and count the office buildings that have mushroomed in the last 10 years. The airport area alone now has more than 16 million rentable square feet of office space, or about two-thirds of the total in downtown Los Angeles.
The total for the county is 36.2 million square feet, compared with less than 10 million in 1977. More than seven million additional square feet is under construction.
Early growth in Orange County office space was fueled by Los Angeles companies trying to escape the city’s smog and traffic. Now, most of the demand comes from companies already in Orange County, looking to expand.
In recent months demand hasn’t kept up with the increasing supply. The vacancy rate for the county was 23% at the end of the third quarter, up from 21% in the second quarter, according to Grubb & Ellis Commercial Brokerage Services. Still, a Grubb & Ellis spokesman pointed to a high rate of absorption of new space--2.5 million square feet were newly occupied in the first nine months of 1987--as a better indication of the health of the county office market.
ey used to call Orange County a bedroom community for Los Angeles. Anyone who still harbors that misconception is invited to drive east on I-405, past South Coast Metro and John Wayne Airport, and count the office buildings that have mushroomed in the last 10 years. The airport area alone now has more than 16 million rentable square feet of office space, or about two-thirds of the total in downtown Los Angeles.
The total for the county is 36.2 million square feet, compared with less than 10 million in 1977. More than seven million additional square feet is under construction.
Early growth in Orange County office space was fueled by Los Angeles companies trying to escape the city’s smog and traffic. Now, most of the demand comes from companies already in Orange County, looking to expand.
In recent months demand hasn’t kept up with the increasing supply. The vacancy rate for the county was 23% at the end of the third quarter, up from 21% in the second quarter, according to Grubb & Ellis Commercial Brokerage Services. Still, a Grubb & Ellis spokesman pointed to a high rate of absorption of new space--2.5 million square feet were newly occupied in the first nine months of 1987--as a better indication of the health of the county office market.
HOW COUNTY OFFICE SPACE COMPARES
In millions of sq. feet ORANGE COUNTY: 36.2 DOWNTOWN LOS ANGELE: 25 DOWNTOWN SAN FRANCISCO: 28.9 SAN DIEGO: 27.9 DOWNTOWN SAN DIEGO: 6.8 OFFICE BUILDINGS IN ORANGE COUNTY
EXISTING BUILDINGS UNDER CONSTRUCTION Number Rentable Vacancy Number Rentable Market Area Bldgs Square Feet Rate Bldgs Square Feet Airport Area 221 16,576,139 24% 20 3,504,749 South County 47 2,353,815 16% 4 505,900 Central County 165 11,117,44 21% 17 2,287,633 North County 56 2,782,923 28% 6 631,249 West County 58 3,400,986 24% 2 262,000 Total 547 36,231,309 23% 49 7,191,531
Source: Grubb & Ellis Research Services Group
