Colliers Sacramento Office Snapshot: Q1 2023

Regional Vacancy Rate Ticks Up to Highest Point in a Decade. As reported by Colliers Sacramento, the vacancy rate appears poised to rise through much of the rest of the year with large blocks of space to be vacated by CalSTRS and Centene likely to outpace scheduled occupancies of vacant buildings by UC Davis Health, California Highway Patrol, and CapRadio.

Colliers Sacramento Office Market Absorption & Vacancy Rate 2014-2023

Quarterly net absorption was -464,299 square feet but would have been slightly positive without Centene’s 517,000 square foot vacant sublease in North Natomas. The Sacramento region’s office market has now witnessed a staggering amount of occupancy losses since early 2020 as companies are reorienting their office space requirements in this new age of hybrid work. Diminishing office occupancy and falling net operating incomes are beginning to lead to distress in the office sector. It is likely property defaults will rise in the next two years as mortgages signed before the pandemic expire.

Colliers Sacramento Market Fundamentals 2023

Colliers Sacramento Office Development Pipeline 2018-2024