MARKET TRENDS
- Vacancy has climbed 230 basis points (bps) since Q2 2023 and now sits at 7.5% but has been failing for the third consecutive quarter. The Southwest and Mountain View Corridor West submarkets sport the highest vacancies in the market, both being above 12%.
- Q2 2024 net absorption of 2.1 million square feet was the highest figure the market has experienced since Q4 2022. Leasing activity was also strong as ID Logistics and Albany Industries, leased 1.0 million square feet (msf) and 350,000 square feet (sf), respectively.
- The construction pipeline is at its lowest point in recent years and has been steadily declining since its 5-year peak of 11.3 msf in Q2 2022. Despite being currently elevated, vacancy will stabilize in the medium term as the remainder of this cycle's pipeline gets delivered.