The Santa Barbara commercial real estate market most likely won’t decline, but Pacifica Commercial Realty predicts another slow year, according to its year-end report.
“The consistent performance and increased dollar value of the last 18 months strengthens the perception that the commercial sales market is clearly out of the bottom of 2008 and 2009,” the report reads. “This trend shows stability, but it is not suggesting any significant upward movement of increasing values for owners.”
Although the technology sector anchored most of 2011’s activity, there is little impetus for “breakout growth” as investors wait for signs of a sustained recovery, according to the report.
“The technology sector demonstrated continued strength with several mergers, acquisitions and emerging firms,” the report states.
The Goleta office market vacancy rate dropped 1.9 percent to 10 percent as Deckers Outdoors Corporation, Appfolio, Yardi Systems, Network Hardware Resale and Arthrex expanded.
Deckers acquired 14 acres of land on the corner of Los Carneros Road and Hollister Avenue and expanded into 12,000 square feet at 120 Cremona Drive. Appfolio moved across the street into 50 Castillian Drive, Yardi expanded at the Goleta Business Park, Network Hardware Resale took over Citrix’s former location at 6500 Hollister Ave., and Arthrex occupied Superconductor Technologies’ old 23,000-square-foot spot at 460 Ward Drive.
“We expect 2012 to bring a similar amount of leasing activity to the Goleta market,” the report states.
Santa Barbara’s office market vacancy rate increased slightly, 0.5 percent, to 5.7 percent, including Antioch University’s former location at 801 Gutierrez St. Other than RightScale’s move to 402 E. Gutierrez St. and Vetronix’s lease renewal, most of the activity involved sites of less than 3,000 square feet.
Leasing activity in Carpinteria’s office market remained slow as vacancy rates increased 5.1 percent to 20.9 percent despite Lynda.com’s continued expansion.
The local retail market remained quiet in 2011 as the vacancy rate held at 3.2 percent. REI moved to 319 Anacapa St., the 99 Cents Only store leased the 424 State St. location, and Ulta, a national cosmetics superstore, will lease half of the former Borders location in the Camino Real Marketplace.
Pacifica said it is negotiating the rest of the space with a “familiar national chain tenant.”
But despite some of the lowest interest rates on record, buyers remain cautious, according to the report.
“(This year) affords local tenants and purchasers an opportunity to acquire new facilities at reasonable rates and sales valuations,” the report reads.
— Noozhawk business writer Alex Kacik can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.
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