Occupied office space in the Valley and Ventura County shrank by 328,700 square feet during the third quarter, according to a study by Colliers International, largely due to vacancies brought about by shuttered mortgage finance companies. This was the first quarter in two years that showed a loosening of the tight office-space market. Vacancy rates climbed to 9.8 percent but still remained in healthy territory, the report said. Rental rates continued to rise, being up 13.6 percent over one year ago. Meanwhile, construction was relatively strong, Colliers said, with 1.7 million square feet being developed. When this space arrives on the market, vacancy rates are expected to climb into the low teens, tilting the market slightly in favor of the tenant, Colliers said. Rental rates are expected to stagnate at that time.
