Study Notes 21% Vacancy Rate for Office Space

The vacancy rate for San Fernando Valley office space inched up to 21% by the end of the second quarter, according to the latest study by the realty firm of Grubb & Ellis. At the end of the first quarter the rate was 20%, and a year earlier it was 14%, the firm reported.

The study found that 3.2 million square feet were vacant, of a total inventory of 15.4 million square feet.

One reason for the higher vacancy rate was a slackening of leasing activity. In the second quarter, 263,000 square feet were leased, off nearly 6% from the first quarter. The year-ago figure wasn’t available.

The highest second-quarter vacancy rate was in the East Valley, defined as Burbank, North Hollywood, Studio City and Universal City, where the rate was 28%, up from 22% a year earlier.

The Encino, Sherman Oaks and Van Nuys area had an 18% vacancy rate, up from 8% a year earlier. The area including Calabasas, Canoga Park, Tarzana and Woodland Hills had a 19% rate, up from 10%. On the other hand, the Conejo Valley, including Agoura, Thousand Oaks and Westlake Village, had a 20% rate, down from 25% a year earlier.

The survey covered 215 multi-tenant buildings larger than 20,000 square feet. Grubb & Ellis said nearly all office buildings other than medical buildings, government buildings and one-tenant, owner-occupied structures were surveyed.