South Peninsula Office Market Report
| Average NNN Asking Rent (Price/SF) | $6.33 |
| Availability Rate (%) | 13.1% |
| Net Absorption (SF) | 1,880,742 |
The South Peninsula office market achieved net positive leasing absorption for only the third time in the last 12 quarters. During the first quarter, net positive absorption was approximately 1.9 million square feet. Gross absorption was approximately 2.9 million square feet. These large quarter-over-quarter increases are not indicative of the region’s true leasing activity, as they can be attributed to only two owner-occupied projects: Google’s Bay View Campus (1.1 million square feet) and LinkedIn’s campus at South Middlefield (1.0 million square feet). The South Peninsula’s net absorption without these completions would have been close to negative 265,000 square feet, and total gross absorption would have been approximately 718,000 square feet. Without the completion of these two major projects, gross leasing activity was essentially flat from the previous quarter but still almost double from one year ago.
South Peninsula R&D Market Report
| Average NNN Asking Rent (Price/SF) | $5.45 |
| Availability Rate (%) | 10.2% |
| Net Absorption (SF) | -45,217 |
In the first quarter of 2022, the South Peninsula’s overall gross absorption was almost 50.0% less than the fourth quarter of 2021, where the South Peninsula closed the year with approximately 775,000 square feet of gross absorption and positive net absorption for the third straight quarter. The total leasing activity for the quarter was approximately 390,000 square feet leased. There was approximately 45,000 square feet of negative net absorption. Demand on the South Peninsula remained solid, due in large part to healthy diversity. Tech, life science and automotive tenants are seeking over 2 million square feet of R&D space in the South Peninsula.