CBRE San Diego released MarketView reports covering San Diego commercial real estate activity in the fourth quarter of 2013.

San Diego office investment sales rose in the fourth quarter, exceeding $1.3 billion for the year; with institutional sales reaching their highest level since 2007. Construction also posted large gains influenced by the 330,000 square foot Sempra corporate headquarters project in Downtown San Diego. Net absorption turned slightly negative in the fourth quarter after 17 consecutive quarters of increases. The pull-back was primarily due to uncertainty created by the federal budget impasse and the Affordable Care Act.

According to CBRE Executive Vice President Louay Alsadek, the office market has improved dramatically in recent years and will continue to perform. “We expect buyers to remain bullish, recognizing that quarterly activity can be skewed relative to the overall direction of the market,” Alsadek said. “Office employment has maintained a steady pace of growth which bodes well for the San Diego office market in general.”

Industrial activity rose in the fourth quarter, ending the year with steady improvement in net absorption and lease rates; both increased consistently throughout the year with net absorption posting its tenth straight quarter of gains.

A surprisingly strong holiday shopping season, combined with record numbers of people dining out, contributed to a strong quarter in retail leasing activity. Retail vacancy reached its lowest level in three years and net absorption rose to almost half a million square feet for the year. Retail lease rates dipped slightly overall, yet owners were able to obtain rent premiums in San Diego’s most desirable submarkets.

Click here to download the reports.