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With over 74 million square feet of office space, retail space in excess of 69 million square feet and over 192 million square feet of industrial space it means there are lots of options, maybe an overwhelming amount, in finding appealing office space in San Diego.

San Diego, California, on the coast of the beautiful Pacific Ocean, is just 120 miles south of Los Angeles and just north of the Mexican border. As the eighth largest US city with a population of over 1.3 million, it is one of the fastest growing cities in the country and a great place to live and work. The year-round pleasant climate, deep-water harbor, strong economy, state-of-the-art healthcare and gorgeous landscape of hills and canyons combine to attract people to San Diego.

Locating a good value in office space San Diego has available can be tricky if you attempt to do it alone. Property owners today list directly with professionals, avoiding newspaper and other advertising. This practice makes it more difficult for the public to find reliable information on available office space in San Diego area and the surrounding submarkets such as Del Mar Heights, East County , I15 Corridor, Kearny Mesa, Mission Valley, North County, Sorrento Mesa or Carlsbad

You’ll find the process of securing office space San Diego or nearby submarkets has to offer much easier now that you have found OfficeFinder. No matter if you prefer office space for rent, lease or purchase, LOCAL San Diego office tenant representatives of the highly experienced OfficeFinder team can help you locate space that meets your needs – and the service is FREE. We can help you through the negotiating process, through taking possession of the keys to the office you secure. Simply submit the short form on this page and you’ll be contacted by a LOCAL OfficeFinder expert to discuss your needs and desires in San Diego office space in full. Using professional-only databases, your OfficeFinder representative matches your specific needs to available San Diego office space and you’ll visit only those you love, much faster than searching alone. You’ll find OfficeFinder will save you time and money, so give us a try.

We can also help If you need agile space such as a virtual office or serviced suite, or require a specialized facility for medical use, wholesale center, retail store or light industrial center. Give us a try.

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Current San Diego Market Conditions

In spite of what Oside News describes as a somewhat flat fourth quarter -- which saw the end of a 17-quarter streak for occupancy gains -- the San Diego office market closed 2018 on a high note, with strong net absorption and asking rates, combined with lower vacancy than in 2017. Experts expect that the less-than-exciting close to the year to be an isolated glitch, with the market gaining strength throughout 2019.

A Healthy Market

With major office space deals being driven by the technology, life sciences, and financial sectors, San Diego has a healthy office space market. Here are some of the highlights, according to information provided by CBRE.

Demand is strong for new, quality office spaces. Some of the power players in this market include Apple, which announced in late 2018 that it was leasing 96,543 square feet of office space at a Class A facility in UTC. The tech giant plans to add 1,000 area jobs in the next five years.

13,400 office jobs were added in the region in 2018, accounting for more than half of the overall job growth here. The San Diego area has had six consecutive quarters of office job growth.

Experts believe that Apple's increased presence in the area may spur other tech companies to increase their presence here, as well.

Of all of the office space submarkets, downtown and Mission Valley saw the biggest increase in asking rates for office space. Overall, asking rates in the San Diego area increased 2.6 percent over 2017, with the demand for Class A space driving higher rates.

Although no new office space construction broke ground in the fourth quarter of 2018, a number of projects were already in progress.

The United States Navy led the pack in important lease transactions for 2018, leasing more than 350,000 square feet of Class A space downtown.

Del Mar Heights saw several transactions of more than 20,000 square feet of office space during 2018. Some of the companies involved in those transactions include FICO, Acadia Pharmaceuticals, and Mintz Levin. The Acadia transaction involved the company pre-leasing two floors of a new office building which had not yet broken ground as of the year's end. 

13 properties, with about 11.7 million square feet of office space, are scheduled to complete construction in 2019. Over half of that space is build-to-suit projects that are pre-leased.

Tenant demand in the region equals about 3.2 million square feet of office space.

Where Are the Vacancies?

With a healthy net absorption, the San Diego area saw a 100-basis-point decrease in office space vacancies for the year, CBRE reported. For the first time since 2014, the vacancy rate for Class A space fell below 12.0 percent. Class B spaces, for which the vacancy rate has ranged between 9 and 11 percent over the last 8 quarters, rounded out the year with a rate of 10.1 percent. Here are some additional facts about office space vacancy rates in the San Diego area.

A surge of leasing activity throughout the year in Sorrento Mesa submarket drove its vacancy rate down 560 basis points, to 13.5 percent.

North County is the region with the highest overall vacancy rate, at 14.3 percent. 

Downtown's overall vacancy rate was 11.3 percent at the end of 2018 -- slightly lower than the 11.7 rate from the third quarter of the year -- and the Central San Diego area saw a vacancy rate of 9.9 percent.

The area with the lowest office space vacancy rate in 2018 was East County at 2.8 percent.

The suburban market had a vacancy rate of 10.6 percent, with larger core submarkets such as Kearny Mesa and UTC seeing the lowest rates. Carlsbad had the highest vacancy rate for the larger suburban submarkets, at 16.9 percent. All submarkets saw vacancy rates below 20 percent for the second consecutive quarter.

Class C spaces posted the lowest vacancy rate at 6.8 percent, while Class A and Class B had rates of 13.4 and 9.8 percent respectively.

What Is Happening With Rent Rates?

The average asking rate for office space in the San Diego area was $2.97 per square foot by the end of 2018, and rates were up in all but two major markets. This represents a .5 percent increase quarter over quarter, and a 2.6 percent increase year over year, according to CBRE research. Rate growth in 2017 and 2018 was moderate in comparison to 2015 and 2016, when rates increased 10.8 percent and 6.0 respectively. The highest asking rate increases are seen in the Class A market, due to an increase in demand and low supply.

The highest rate increases were seen in Mission Valley and Downtown, with 12.6 and 8.7 percent higher rates respectively, when compared to the year before.

In the Pipeline

As reported by Colliers International, 2018 turned out to be the second-highest year for new office construction in the past nine years, with eight projects totaling 11 million square feet expected to hit the market either by the end of 2018 or during this year. Here is a glance at some of those projects:

4 buildings, built-to-suit, on Town Garden Road in Carlsbad. The project, which is being built for ViaStat, brings 357,000 square feet of new office space to the market.

50,000 square feet of creative office space at Makers Quarter, downtown. 33,806 square feet of this space was pre-leased to International Workplace Group.

150,000 square foot office building that was built by Alexandria Real Estate Equities and pre-leased to Takeda on Towne Centre Drive.

A 5,000 square foot mixed use project including creative office space in Mission Valley.

54,646 square feet on Innovation Way in Carlsbad, developed by RAF Pacifica Group.

A 158,994 square foot building in Scripps Ranch, pre-leased to MedImpact.

A two-building 300,266 square foot project in Carmel Valley being developed by Kilroy Realty.

24,000 square feet of office space on S. Coast Highway 101 in Encinitas.

Colliers notes that, in addition to new construction, there are several buildings in the downtown area that are undergoing renovations that will elevate them to Class A space, including the 345,016 square foot office building known as Tower 180, which was vacated during renovation due to the need for asbestos abatement.

Are you looking for office space in San Diego? Let our highly qualified leasing and sales professionals help. Contact us for more information.

Useful Statistics for businesses looking for office space in San Diego
  San Diego CA State
2016 Estimated Population 1,374,812 38,654,206
Median Age 34.2 36
Housing Units 527,049 13,911,737
Occupied 490,219 12,807,387
Owned 228,007 6,929,007
Rented 262,212 5,878,380
Average Household Size 2.73 2.95
Rental Vacancy Rate 3.7% 3.8%
Homeowner Vacancy Rate 1.3% 1.3%
Median Home Value $488,600 $409,300
Median Monthly Rental Cost $1,427 $1,297
Estimated Mean Income $107,292 $101,373
Median Household Income $68,117 $63,783
Percent of Individuals below poverty level 15% 15.8%
Educational Attainment: Percent high school graduate or higher 87.5% 82.1%
Educational Attainment: Percent high school graduate 16% 20.6%
Educational Attainment: Percent with some College 20.4% 21.7%
Educational Attainment: Percent bachelor degree or higher 43.6% 32%
Average Commute time in minutes 23.5 28.4
Commute 684,137 17,193,695
Commute by car, truck or other vehicle - Drive Alone 511,737 12,636,396
Commute by car, truck or other vehicle - Carpool 61,212 1,825,507
Use Public Transportation 26,883 894,813
Work from Home 47,531 934,436
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