We have now seen two consecutive quarters of declining
vacancy and positive absorption in the Sacramento office market. Colliers International is reporting that available supply is shrinking and downtown’s
Class A vacancy rate has been held below 20% throughout 2025. This report by Colliers
also discusses the office market recalibration in downtown, including the disposal
of the 25-story state office building at 450 N Street that has been defective
for decades with the state spending approximately $60 to $100 million trying to
repair the never ending problems. Also being considered is turning three state
properties along Capitol Mall into mixed-use Sacramento State event spaces.
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