San Diego Business Journal

PwC Survey Says Local Office Market at Equilibrium

Wednesday, March 21, 2012

San Diego’s office market fundamentals are essentially at a standstill — equally favoring buyers and sellers — with property values expected to remain static during the next 12 months, according to the latest national investor survey by PricewaterhouseCoopers.

Results of the quarterly survey of real estate investor sentiment, covering 18 U.S. markets, were released March 19 by the consulting firm, also known as PwC.

For the first quarter, 60 percent of surveyed investors said the local office market is at equilibrium between buyers and sellers, a sentiment that has remained steady for the past three months.

Total local office property sales volume in 2011 was up nearly 21 percent compared with 2010, according to Real Property Analytics. The survey said some investors expect volume to accelerate in the near term, as foreclosure sale activity picks up in 2012.

Annual leasing activity in the local market was up in 2011, but average asking rents were down, creating an advantageous leasing market for tenants, the report said.

Nationwide, PwC reported that many investors remain focused on how to capitalize on the burgeoning apartment sector, and a growing number of buyers are revisiting the rebounding industrial sector.

— Lou Hirsh