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IE office market starts 2023 on right foot

The Inland Empire office market enjoyed a solid first quarter, with vacancy, net absorption, and lease rates all moving in the desired direction, according to data released today.

The region’s vacancy rate during the first three months of 2023 was nine percent, down from a revised 9.4 percent in the fourth quarter of 2022, CBRE reported.

Eight four thousand eight hundred square feet of space was absorbed during that time, up 10.1 percent quarter-over-quarter, while the average lease rate  – $1.97 a square foot – was a two-cent increase from the last three months of 2022.

Just under 39,000 square feet of office space was under construction as the first quarter ended, essentially unchanged from the end of last year.

“The Inland Empire office market maintained steady activity during the first quarter,” the report states. “Minimal move-outs, persistent leasing activity in the 1,000 to 5,000 square foot range, and four transactions [greater than] 10,000 square feet  have served to strengthen market fundamentals this quarter.”

Interest rate hikes could cause the market to tighten between now and the end of the year, according to CBRE.

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