Q2 2024 Silicon Valley Office Market Report

The Silicon Valley office market showed signs of stabilization in Q2. Vacancy remained flat QoQ, increasing by only 0.1%, but increased by 2.5% YoY. Asking rates have decreased in four consecutive quarters, finally reflecting market fundamentals, with a YoY decrease of $0.12, or 2.3%. Unlike other struggling markets, Silicon Valley has delayed significant shifts in asking rates, although landlords are beginning to adjust to market realities. Availability also remained flat at 20.6% QoQ, however decreasing by 1.0% YoY. YTD net absorption is positive at 1.2M SF, largely due to Walmart Labs moving into Crossman, which was counted this quarter.

The Silicon Valley office market continues to face challenges, despite recent positive data. A complex mix of city regulations and varying market fundamentals complicates the development of a cohesive regional recovery strategy. For a sustainable rebound, macroeconomic factors must improve, and there must be a shift towards more responsive RTO policies.

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