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South Coast office space remains at a premium

1/30/08
By DALE RIM
NEWS-PRESS BUSINESS EDITOR

WANTED: Office space in a Class A building on the South Coast; willing to pay through the nose.

According to Pacifica Commercial Realty's 4Q Commercial Market Update, office/R&D rents in Santa Barbara are substantially higher than in Ventura County and much of Los Angeles and Orange counties, and the current recession talk won't have that great an effect on the South Coast.

In Santa Barbara, fourth-quarter asking rents increased to $2.65 gross, a gain from the previous quarter of $2.54 gross. While that 11 cents per square foot is a boon for landlords, it begs the question: Might the increase impede other businesses from relocating to the area?

"The fact is that Santa Barbara has always been perceived as expensive," said Mark Mattingly, executive VP of Pacifica Commercial Realty. "Owners of companies want the Santa Barbara lifestyle (regardless of the cost). Rental rates are up all across the nation in the office sector because of supply and demand. Construction rates are high, and vacancy rates are low."

The South Coast's most notable new project, the Cabrillo Business Park, will provide approximately 500,000 square feet of office and research space. The 90-acre development, located at the entrance to UCSB at Los Carneros Road and Hollister Avenue, is not being pre-leased at this time, according to Mr. Mattingly. Phase One -- consisting of two new office buildings totaling 140,000 square feet -- begins this summer and is scheduled to be completed at the end of 2009.

In Carpinteria's 525,000-square-foot base in the office/R&D market, only 26,220 square feet are available, a 5 percent vacancy rate. The fourth-quarter asking price of $1.49 gross increased slightly from the previous quarter's average of $1.46.

The same market in Goleta saw vacancy levels lowered to 3.3 percent. Of the 4.2 million square feet that make up the market, 136,424 square feet are available. The fourth quarter average price of $1.74 gross increased 7.4 percent from the previous quarter's average of $1.62.

In Santa Barbara, approximately 5.1 million square feet make up the market and only 123,698 square feet are available for rent, a 2.4 percent vacancy rate compared with a 2.8 percent vacancy rate the previous quarter.

The Santa Barbara Trust for Historic Preservation announced that Craig Makela, president of Santa Barbara Olive Co., was named the new president of the board at the Trust's 45th annual Meeting and Community Awards presentation. The Trust also elected community leaders Rob Rossi and Jack Theimer to the board of directors and re-elected incumbents Timothy Aguilar, W. Elliot Brownlee, Suzanne Schomer, Anthony P. Spann and Mike Stoker.

RESIDENTIAL FRONT: Daniel Encell, director of estates division, Prudential California Realty, reports median home prices along coastal Santa Barbara County climbed 5 percent to $1.049 million and average prices rose 9 percent to $1.806 million. According to the CORT Report, Montecito, Hope Ranch and beach properties propped up the home prices in the county: Hope Ranch's average sales price from 36 homes sold was $4.32 million, and Montecito's median sales prices was $3.83 million of the 243 homes sold. However, Santa Barbara had a decline in the number of sales (837) and the median price of $1.015 million, and Goleta had a third consecutive year of declining sales (347) and median price of $825,000. His conclusion: 2008 will see estate properties having another solid year because of low inventory, but the lowest-priced segments of the market have not yet hit bottom.

SIGN OF THE TIMES?: A Mediterranean hilltop villa in Montecito with drop-dead views has been on the market for six months at $14 million. A few offers have been made, but not close enough to close the deal.

TRANSACTION: Elie M. Genadry d/b/a/ Montecito Frame & Gallery leased 1,550 square feet of retail space at 2173 Ortega Hill, Summerland, from Diane Norman. Brad Frohling of Radius Group represented both parties.

 

MARKET INFO > ARTICLES HOME PAGE

Tight inventory, higher prices for South County home market
(Santa Barbara News Press, 1/26/2014)

Now is the Time to Sell
Los Angeles Times, 1/2/2011)

2009 Survey
(Realty Times, 1/6/2010)

Golfer Couples Sells House
(Wall Street Journal, 9/18/2009)

Best Cities For A Housing Recovery
(Forbes.com, 8/13/2009)

A Tale of Two Markets Divided by the Conforming-Loan Limit
(Los Angeles Times, 6/14/2009)

When Home Prices Hit Bottom
(CNN, 4/1/2009)

PGA pro Fred Couples Lists Montecito Home at $12.5 million
(Los Angeles Times, 3/24/2009)

The Road to Recovery
(Dan Encell, 3/12/2009)

How to Sell a House, When You Have to Sell It Now
(Wall Street Journal, 7/14/2008)

S.B. listed as one of U.S.'s most distinctive destinations
(Santa Barbara News-Press, 1/13/2009)

South Coast economy resolute, expert says: Forecast: Santa Barbara's situation "boringly steady"
(Santa Barbara News-Press, 4/18/2008)

South Coast office space remains at a premium
(Santa Barbara News-Press, 1/30/2008)

2007 Real Estate & Economic Outlook
(CASA, 3/2/2007)

Home Prices May Fall Again
(Santa Barbara News-Press, 2/23/2007)

Home Sellers Find Buyers are Standing Tough
(Santa Barbara News-Press, 11/10/2006)

Future Trends will Reshape Real Estate Industry
(Santa Barbara New-Press 11/1/2005)

Number of Homes Sold in County Drops
(Santa Barbara News-Press 10/25/2005)

Housing Market Shows Signs of Flattening
(Santa Barbara News-Press 9/30/2005)

Home prices hot, but buyers cool
(Santa Barbara News-Press 3/24/2005)

Casa de Maria puts price tag on Montecito Property
(Santa Barbara News-Press 1/25/2005)

Helping buyers find their "Home Safe Home"
(Santa Barbara News-Press 1/2/2005

Rich buyers help boost median home prices
(Santa Barbara News-Press 12/23/2004)

Copyright Dan Encell