A Market Recalibrating
Orange County’s office landscape is evolving from correction to strategic growth.
After several years of fluctuating demand, 2025 marks a period of steady recovery — driven by the rise of office clusters, where tenants and developers are reimagining space through proximity, collaboration, and convenience.
From Irvine Spectrum to Airport Area and South Coast Metro, these clusters are reshaping how and where companies lease — with implications that extend far beyond square footage.
According to CBRE’s Southern California Office Market Outlook 2025, Orange County’s overall office vacancy has stabilized at 15.7%, while submarkets near innovation, lifestyle, and transit nodes are outperforming the regional average by nearly 400 basis points.
💡 KEYZ Insight: Orange County’s next office cycle won’t be defined by how much space tenants occupy — but where they choose to cluster.
Where the Growth Is: The Rise of OC’s Office Clusters
Irvine Spectrum: The Innovation Core
The Irvine Spectrum remains Orange County’s dominant office cluster — fueled by technology, medtech, and professional services tenants.
With access to the 5 and 405 freeways and proximity to UC Irvine, Spectrum’s tenant ecosystem continues to expand, offering high-performance buildings and lifestyle-driven amenities.
- Vacancy: ~16% (JLL Q2 2025)
- Average Asking Rent: $2.85 FS/sf/mo
- New Construction: 780,000 sf under development (Irvine Company, 2025)
- Common Incentives: TI allowances up to $25/sf, 2–3 months free rent
What It Means for Tenants:
Flight-to-quality continues. Many firms are upgrading from mid-tier Class B space to newer Class A+ buildings without significant rent premiums, leveraging landlord competition.
📊 JLL’s Orange County Market Report 2025 notes that tenants relocating within the Spectrum can save up to 10% on total occupancy costs when signing early renewals.
South Coast Metro: The Lifestyle Business Hub
Anchored by South Coast Plaza, Costa Mesa, and John Wayne Airport, South Coast Metro is transitioning into a mixed-use, live-work-play environment ideal for hybrid tenants.
- Vacancy: 13.9% (CBRE Q2 2025)
- Average Asking Rent: $2.92 FS/sf/mo
- Key Drivers: Proximity to dining, retail, and hotels; ongoing office-to-flex conversions
Emerging Trend: Mid-sized professional firms — from legal to design to financial services — are relocating to South Coast Metro to attract talent through location appeal and commute efficiency.
What It Means for Tenants:
Smaller tenants (under 10,000 sf) are gaining access to premium space once reserved for corporate HQs, as landlords diversify lease structures to fill large floorplates.
🏙 KEYZ Perspective: The Metro cluster is leading Orange County’s office-to-experience movement — blending hospitality, wellness, and flexibility into everyday workplace strategy.
Airport Area: Transit-Oriented Resilience
Despite elevated vacancy, the Airport Area is experiencing renewed interest driven by accessibility and flexible building stock.
According to CoStar Market Analytics, leasing volume jumped 18% quarter-over-quarter in Q2 2025 — the largest uptick since 2022.
- Vacancy: 17.2%
- Average Asking Rent: $2.68 FS/sf/mo
- Tenant Mix: Aviation, logistics, healthcare, and tech-adjacent firms
- Sublease Space: Down 12% YoY, signaling stabilization
What It Means for Tenants:
Tenants can negotiate aggressively for early renewal options, expense caps, and parking concessions, while maintaining proximity to major transit corridors.
KEYZ Strategy: Tenants securing long-term leases in Q3–Q4 2025 are locking rates 5–8% below peak pricing.
Irvine Business Complex (IBC): Adaptive Repositioning
The Irvine Business Complex is redefining flexibility in Orange County. Once dominated by low-rise office parks, IBC is transitioning into a mixed-use innovation corridor integrating office, flex, and residential uses.
- Vacancy: 15.4% (CBRE, 2025)
- Average Rent: $2.78 FS/sf/mo
- Construction: Over 2.1M sf of redevelopment in pipeline (City of Irvine Development Report, 2025)
What It Means for Tenants:
IBC offers some of the most flexible lease options in the county, including short-term commitments, spec suites, and build-to-suit opportunities.
Tenants in creative and technology sectors are leveraging adaptive reuse projects — repurposed industrial and flex buildings — for brand-centric workspaces.
Pro Tip: Early tenants in these repositioned assets often secure TI packages worth 15–20% of total lease value.
Why Office Clusters Matter for Tenants
KEYZ Takeaway:
Clustering isn’t just a landlord strategy — it’s a tenant advantage. Being in a thriving ecosystem enhances brand presence, collaboration, and operational agility.
The Tenant Advantage in 2025
With elevated vacancy and ongoing competition, tenants have leverage — especially in Class A submarkets.
Landlords are offering free rent periods, enhanced TI packages, and parking incentives to maintain occupancy.
According to Marcus & Millichap’s 2025 Office Market Report, average effective rents in Orange County remain 7–9% below 2022 peaks, with renewal activity up 12% YoY.
KEYZ Commercial’s Strategy for Tenants:
- Start renewals 9–12 months early
- Request 3% annual caps or CPI alternatives
- Push for flex options in lease terms
- Benchmark against 2021–2023 comps for negotiation leverage
Looking Ahead: 2026 and Beyond
KEYZ Forecast:
As new office clusters strengthen around mobility, amenities, and innovation, tenants who plan proactively in 2025 will capture below-market rents with premium features.
Clustering as a Competitive Edge
Office clusters are redefining Orange County’s commercial identity — concentrating talent, technology, and capital in distinct growth zones.
For tenants, this evolution means one thing: choice with leverage.
At KEYZ Commercial, we help businesses evaluate market clusters, model occupancy costs, and negotiate data-driven lease structures that align with both brand goals and financial performance.
The 2025–2026 cycle will reward tenants who think strategically, act early, and cluster smartly.
Contact KEYZ Commercial
📍 Visit: www.keyzcre.com
📧 Email: hello@keyz.com
📞 888.539.9101 (KEYZ 101)