While some market participants are eager to paint a picture of recovery in Orange County’s office market, current fundamentals still support a tenant-favorable narrative—particularly for those of us actively representing occupiers in this environment.
Yes, the overall availability rate has declined modestly—from a peak of 16.9% in early 2023 to 14.9% in Q3 2025—but that figure masks deeper challenges. For example, net absorption over the past 12 months remains negative by almost 750,000 square feet, signaling that more space is being vacated than leased. Fortunately for tenants, this is hardly a marker of sustained momentum or a healthy rebalancing of supply and demand.
A closer look at submarket-level data reinforces this caution. The chart below illustrates a significant increase in space availability across some of Orange County’s most prominent office hubs today, compared to Q1 2020:
Each of these submarkets—especially Aliso Viejo, the Stadium Area and the Airport Area—has seen a marked increase in availability, much of it driven by sublease space, a clear indicator of ongoing corporate downsizing and space consolidation. In fact, elevated sublease volumes are often a leading signal of weaker near-term leasing demand, as tenants look to offload space they no longer need.
Some landlords may point to isolated quarters of improved new leasing volume (like Q2’s 1.9 million SF), but these are not sustained trends, and the overall pipeline of tenant demand remains uneven. Meanwhile, building owners continue to offer aggressive incentives (free rent, tenant improvement allowances and broker bonuses) to fill vacancies, especially in older Class A inventory.
Adding to the tepid outlook is the slow pace of office-using employment growth and the fact that many companies are still refining their hybrid work models. And while no major new construction has broken ground since 2021, limiting future supply, it’s more a function of muted demand and leasing uncertainty than confidence in market recovery.
In short, tenants still hold the leverage in most Orange County office lease negotiations. Until we see sustained positive absorption, broad-based demand across submarkets and real upward pressure on net effective rents, it remains premature to call this market anything but soft.
Frequently Asked Questions: Orange County Office Market 2025
Not yet, at least not in any sustainable sense. Availability has declined modestly from its 16.9% peak in early 2023 to 14.9% in Q3 2025, but net absorption over the trailing 12 months remains negative by roughly 750,000 square feet. That is a market slowly exhaling excess space, not a market absorbing new demand. Landlord concessions are still elevated, which tells you where the leverage actually sits.
Different brokerages publish different numbers because “vacancy” and “availability” measure different things. Availability, which includes subleases, space being marketed while occupied and under-construction space stood at 14.9% in Q3 2025, down from 16.9% at the 2023 peak. Availability is the honest tenant-side measure because it counts every building a tenant can actually lease right now.
Aliso Viejo, the Stadium Area and the Airport Area have seen the most significant increases in availability compared to Q1 2020. Much of that increase is driven by sublease space, which is a reliable leading indicator of corporate downsizing and footprint consolidation. The weakness is concentrated, not county-wide, which is exactly why submarket-by-submarket analysis matters before signing any lease.
Face rents have been largely sticky, but net effective rents, the number that actually matters to tenants, are materially lower once you factor in free rent, tenant improvement allowances and other concessions landlords are offering to fill space. The spread between “asking rent” and “what a well-represented tenant actually pays” is wider than the published numbers suggest.
No major new office construction has broken ground in Orange County since 2021. That is a reflection of muted demand and leasing uncertainty, not confidence in a recovery. If developers and their capital partners believed in a durable rebound, they would be underwriting new product. The absence of new construction helps future supply-side fundamentals but is not, by itself, a bullish signal.
Vacancy counts only space that is physically empty. Availability counts every building a tenant can realistically lease today, vacant direct space, occupied space being marketed for sublease and space still under construction. Availability is the honest tenant-side measure, which is why it almost always runs 200–400 basis points higher than the vacancy rate landlord brokers prefer to publish.
For most tenants, yes. Landlord concessions remain elevated, sublease product is available across key submarkets at meaningful discounts, and the competitive process itself still works in the tenant’s favor. If your lease expires within 24 months, or you signed at the top of the market in 2021–2022, there is real value in running a market-check or restructure conversation now, before the fundamentals shift.
Engage a firm that specializes in representing tenants and does not have conflicts with landlords. Hughes Marino represents commercial real estate tenants only, across Orange County, Irvine, Newport Beach, the Airport Area, Aliso Viejo, the Stadium Area and the rest of the county, and is not paid by, or contractually entangled with, any landlord. That alignment is the single highest-leverage decision in any office lease process.
Market statistics provided by CoStar Group.
