Jones Lang LaSalle Chart of the Week
Although a majority of the larger tenants in the market has landed, there is still significant demand for blocks of space 100,000 ft.² or greater in Silicon Valley. Heated markets such as Palo Alto, Mountain View and Sunnyvale continued to experience tight market condition as a result of the lack of options that can accommodate large requirements.
New construction in Santa Clara has eased some supply issues with the completion of 306,900 ft.² of Class A office at Lawson Lane, while phase 1 at 3333 Scott Blvd. will add 746,147 ft.² of additional office space. However, asking rents for such space remain higher than average, as asking prices range from $2.75 to $2.95 NNN in shell condition.
The north San Jose submarket has the most blocks of space options for large users, however, much of the available space is second-generation R&D product. While there are rumors of some potential development, most developers are waiting strong tenant interest before breaking ground.
Courtesy of Jones Lang LaSalle