The vacancy rate for office space in Southern California fell 30 bps year over year this quarter to 9.5%. Employment growth fueled office markets as Los Angeles County, Orange County, the Inland Empire and Ventura County collectively added 54,000 net jobs in office-occupying sectors from June 2018 to June 2019. Positive employment trends are expected to persist for the remainder of 2019. Office space under construction totals 8.8 million square feet. Markets with significant construction are anticipated to see the vacancy rate rise as new space comes online in the second half of 2019.
The asking rent for office space in Southern California increased 5.3% over 2Q 2018 to $2.98/SF, the highest average rent on record. New inventory, coupled with solid demand for office space, have pushed rent upward throughout the region.