TRI Commercial Releases Findings in Q4 2018 Office Research Report
Sacramento witnessed a steady decline in vacant space during this most recent economic cycle and reported 10.16% at the end of 2018. The current vacancy rate is now in line with national vacancy for the first time since 2012. “The office sector will continue to perform well, as it has over the last few years – slow and steady increases as it relates to rent growth and demand,” said Vice President, Brandon Sessions. “However, we could see a plateau as mortgage companies, and housing-related sectors consolidate due to the slowing of the housing market.”
Highlights from the report include:
- Rent growth in Sacramento is not only strong compared to the historical average, but also merits attention. After years of negative or minimal gains, rent growth accelerated beginning in 2015 and by the end of 2018 rents outpaced the U.S. average by 200 basis points. Annual rent growth is currently at 3.6%.
- With steady demand and constrained inventory landlords were encouraged to push rents to levels that have typically been unobtainable. These recent gains have especially been strong in Highway 50 Corridor and select suburban submarkets, many of which are witnessing vacancy rates that are below the metro average.
- Sacramento’s office vacancy decreased due to job growth which continues to outpace the national average with steady demand.
- The government sector propels demand for office space, but the metro will soon receive a boost from the private sector, St. Louis-based health insurer, Centene, a Fortune 100 company, chose Sacramento as its home for a new regional headquarters. This enterprise is expected to build more than one million SF of office space and add approximately 5,000 jobs.
About TRI Commercial/CORFAC International
Founded in 1977, TRI Commercial/CORFAC International is a leading Northern California commercial real estate brokerage and property management (with over 4 million square feet of commercial property under management) firm specializing in San Francisco, East Bay and the Sacramento Metro property markets. The company has expertise in tenant and landlord representation services and helps clients buy and sell commercial and investment-grade property. The company serves office, retail, and land, multifamily and industrial property sectors, with offices in San Francisco, Walnut Creek, Oakland, Roseville, Sacramento, and Rocklin. For more information, visit www.tricommercial.com or call Dina Gouveia in Corporate Marketing at 925.269.3305 CORFAC International is comprised of privately held entrepreneurial firms with expertise in office, industrial and retail properties, tenant and landlord representation, investment sales, multifamily, self-storage, acquisitions and dispositions, property management and corporate services. For more information on the CORFAC call the Chicago headquarters at 224.257.4400 or visit www.corfac.com.