Sacramento Office Market Report
Sacramento’s office market continued showing signs of stabilization in the fourth quarter, with the total vacancy rate dropping 50 basis points over the quarter to 16.0%, an improvement from the end of last year when vacancy was 16.4%. Net absorption was positive 292,596 square feet, marking the first time since the first half of 2020 in which absorption was net positive for two consecutive quarters. Net absorption for the year was positive for the first time since 2020, totaling 387,813 square feet. Leasing activity in 2024 surpassed 2023 leasing levels, and it was nearly on par with 2021 and 2022 leasing. However leasing levels remain nearly 25% lower than the 15-year annual leasing average and nearly 34% lower than the 10-year pre-pandemic leasing average. While there is still quite a gap to full recovery, the market trended in a better direction in 2024.
Sacramento Industrial Market Report
The industrial vacancy rate ticked-up 20 basis points quarter-over-quarter to 5.7%. This is also up from one year ago where the vacancy rate stood at 3.5%. For the first time since 2010, annual absorption is dropping into the negative. Year-to-date net absorption stood at slightly more than negative 540,700 square feet. Leasing activity picked up in the third quarter 2024 at just under 1.8 million square feet. Industrial average asking rents dropped during the third quarter of 2024 at $0.79/SF compared to $.81/SF in the second quarter and $0.85 one year ago.