Colliers Sacramento Office Snapshot: Q4 2018

Colliers International has reviewed the numbers and last years Sacramento office market ended on a positive note. Net absorption is at its highest level since 2005 with seven straight positive quarters, and vacancy at its lowest level in 16.5 years. Downtown also absorbed 100,000sf during the fourth quarter and more than 329,000sf throughout 2018. Asking rates Per Square Footage have also risen at an average of 4.4% year over year. If new construction is going to occur downtown, the asking rate will have to rise to at least $3.10 PSF (according to Sacramento Business Journal 2015 article) or the cost to build won’t pencil out.

So with all this good news, will the need for more office space downtown and rising rates be enough so that the proposed 301 Tower on Capitol Mall can pre-lease 50% of the tower so that construction can begin? That’s approximately 368,500 SF of the 737,000 SF proposed tower. Anything is possible; I hope they have some leads for those who are interested.