Wednesday, November 14 , 2018, 6:13 pm | Fair 62º

 
 
 
 

Tech Sector Anchoring Recovery of Local Commercial Real Estate Market

Pacifica Commercial Realty report outlines vacancy rates, with the second quarter boasting several notable leases in Goleta

The technology sector has generated most of the second quarter’s new leases in the midst of a gradual recovery for the South Coast commercial real estate market, according to Pacifica Commercial Realty.

Nearly 100,000 square feet of Goleta office space was leased in the second quarter.

“Looks to me like the tech engine that keeps Santa Barbara hopping along as fueled by the R&D that comes out of UCSB is the bright spot,” Pacifica Vice President Mark Mattingly said.

The biggest transaction involved Network Hardware Resale leasing 41,228 square feet of office space at 6500 Hollister Ave., where the privately held company relocated its headquarters from nearby 26 Castilian Drive.

Other notable leases included AppFolio relocating to a 14,527-square-foot space at the Castilian Technical Center, Yardi Systems expanding into 15,563 square feet in the Goleta Business Park, Control Point relocating from downtown Santa Barbara to a 14,227-square-feet space in the Castilian Tech Center, and Deckers Outdoors Corporation temporarily moving to a 14,244-square-foot location at 120 Cremona Drive.

Despite the pickup in activity, the Goleta office vacancy rate increased 0.2 percent this quarter, according to Pacifica Commercial Realty. The vacancy rate dropped from 11.9 percent to 9.8 percent in the first quarter, but rose to 10 percent.

It said the Santa Barbara office market remained strong as the vacancy rate decreased from 5.1 percent to 4.7 percent, while Carpinteria remained mostly unchanged with a 17.5 percent vacancy rate.

The South Coast industrial market saw slight increases in the second-quarter’s vacancy rates, except for Carpinteria, which fell from 11.7 percent to 11 percent. In the retail sector, according to the report, the arrival of Marshalls and REI to State Street will help fuel the recovery.

Lease rates are lower than Santa Barbara has seen in the past 10 years, and Mattingly says it will remain a buyer’s market.

“As we look through history, recessions are relatively short and recoveries are relatively sharp, and what we’re seeing here is a very long period of recovery and a very gradual bounce off the bottom,” he said. “But we’re entering a new period of opportunity, which holds promise for those seeking long-term value in commercial real estate. It’s a great time to buy.”

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. Become a fan of Noozhawk on Facebook.

Support Noozhawk Today

You are an important ally in our mission to deliver clear, objective, high-quality professional news reporting for Santa Barbara, Goleta and the rest of Santa Barbara County. Join the Hawks Club today to help keep Noozhawk soaring.

We offer four membership levels: $5 a month, $10 a month, $25 a month or $1 a week. Payments can be made using a credit card, Apple Pay or Google Pay, or click here for information on recurring credit-card payments and a mailing address for checks.

Thank you for your vital support.

Become a Noozhawk Supporter

First name
Last name
Email
Select your monthly membership
Or choose an annual membership
×

Payment Information

Membership Subscription

You are enrolling in . Thank you for joining the Hawks Club.

Payment Method

Pay by Credit Card:

Mastercard, Visa, American Express, Discover
One click only, please!

Pay with Apple Pay or Google Pay:

Noozhawk partners with Stripe to provide secure invoicing and payments processing.
You may cancel your membership at any time by sending an email to .(JavaScript must be enabled to view this email address).

  • Ask
  • Vote
  • Investigate
  • Answer

Noozhawk Asks: What’s Your Question?

Welcome to Noozhawk Asks, a new feature in which you ask the questions, you help decide what Noozhawk investigates, and you work with us to find the answers.

Here’s how it works: You share your questions with us in the nearby box. In some cases, we may work with you to find the answers. In others, we may ask you to vote on your top choices to help us narrow the scope. And we’ll be regularly asking you for your feedback on a specific issue or topic.

We also expect to work together with the reader who asked the winning questions to find the answer together. Noozhawk’s objective is to come at questions from a place of curiosity and openness, and we believe a transparent collaboration is the key to achieve it.

The results of our investigation will be published here in this Noozhawk Asks section. Once or twice a month, we plan to do a review of what was asked and answered.

Thanks for asking!

Click Here to Get Started >

Reader Comments

Noozhawk is no longer accepting reader comments on our articles. Click here for the announcement. Readers are instead invited to submit letters to the editor by emailing them to [email protected]. Please provide your full name and community, as well as contact information for verification purposes only.

Daily Noozhawk

Subscribe to Noozhawk's A.M. Report, our free e-Bulletin sent out every day at 4:15 a.m. with Noozhawk's top stories, hand-picked by the editors.

Sign Up Now >

Meet Your Realtor Sponsored by Village Properties

Photo of Gary Welterlen and Carla Reeves
Gary Welterlen and Carla Reeves
"We both love this business. We strive to make life long relationships from each real estate transaction."

Full Profile >