Hang Nguyen The local commercial real- estate market will continue its rebound in 2005, one group of experts says, and new construction at an Aliso Viejo office complex is a prime example of why. Aliso Viejo-based Parker Properties says it will move ahead on building two four- story office buildings spanning 260,000 square feet. The construction, delayed for two years, is scheduled to start next spring. That decision is in line with what experts at Casden Real Estate Economics Forecast at the USC Lusk Center predict for the local office market. In a report released today, USC says that over the next two years, the vacancy rate will continue to drop and the rents asked will rise. The school believes the 2004 vacancy rate of 13.3 percent will drop to 12.2 percent in 2006. As a result, landlords will be able to ask for $2.28 per square foot per month vs. $2.24 today. Parker Properties' new office buildings in Aliso Viejo will be part of Summit Office Campus, which will span 1.7 million square feet, of which nearly 1 million square feet has been completed since construction began in 1997. The developer pushed back construction because older buildings at Summit, completed in 2001, were slow to draw tenants in a sluggish economy, said Lee Redmond, Parker Properties president. "The office market is getting much stronger," Redmond said. Summit is now 92 percent occupied by tenants such as Lennar Family of Builders, QLogic, Fluor and Chevy Chase Bank. And unlike a few years ago, interest from large tenants is back, Redmond said.
December 10, 2004