San Diego office market activity remains slow in the fourth quarter

In the fourth quarter 2023, the San Diego office market reported a slight increase in leasing activity from the previous quarter to 1.1 million square feet (msf). This brought total leasing activity in 2023 to 4.4 msf which was down 24% from the 5.8 msf in total leasing activity reported in 2022. Office market fundamentals have slowed in the second half of 2023 primarily due to macroeconomic uncertainty and the focus from occupiers on controlling costs, especially in the technology sector where office space demand has slowed nationally. Despite 2023 being a slower year for the San Diego office market compared to the years immediately after the pandemic, there is cautious optimism of an uptick in leasing activity going into 2024, especially if interest rates decrease and venture capital funding increases again.

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