Ahead of COVID-19, rents in San Diego spike; growth likely to stall going forward

Prior to any COVID-19 related market disruption, San Diego's average office asking rent (monthly) stood at $3.20 per square foot (psf). This reflects annual and quarterly increases of 11.4% and 5.0%, respectively. Rents ranged from a low of $2.04 psf in the Highway 78 Corridor and $2.30 psf in the South/Southeast Corridor, to $3.39 psf in North Cities and $3.44 psf in Downtown San Diego. Class A rents increased by 10.2% year over year and 5.6% over the quarter, to $3.53 psf. Central Business District ($3.44 psf) and suburban ($3.12 psf) rents increased by 8.4% and 10.5%, respectively, year over year through the first quarter. As uncertainty stemming from the ongoing pandemic situation looms, activity is sure to drop, and as options return to market, rent growth is likely to stall or reverse.

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