Orange County industrial real estate market report
Q3 2025
The Orange County industrial market is currently experiencing a period of recalibration. Net absorption remained negative in Q3, totaling -871,000K SF, reflecting cautious tenant behavior and increased selectivity. Asking rents have adjusted downward to $1.51/SF, with landlords offering concessions to remain competitive. Vacancy rose to 7.4%, influenced by both softening demand and newly delivered projects still seeking tenants. Leasing activity has moderated in 2025, with 215 transactions totaling just over 2.0 million SF. While many occupiers are delaying expansion decisions, a noticeable increase in property tours suggests growing interest that could support a market recovery if it translates into executed leases.
Net absorption
Absorption remained negative once again, reflecting subdued demand and greater tenant selectivity in the market, with net absorption totaling -871K SF.
Asking rates
Asking rents continued to trend downward, reaching $1.51/SF. Landlords are increasingly offering favorable concessions to attract tenants and remain competitive in the current leasing environment.
Vacancies
Vacancy rates climbed to 7.4% in Q3, driven by softening demand fundamentals and newly completed projects that have yet to secure tenants.
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