South Peninsula Office Market Report
The South Peninsula office market returned to normalized levels in Q1 2025, recording 736,774 square feet of leasing activity following last quarter’s historic performance.
The South Peninsula market experienced 160,028 SF of negative net absorption in 1Q25, predominantly from new available space being listed in Menlo Park especially in the non-Downtown submarkets. Palo Alto drove leasing activity in the region, representing 40% of total square footage leased. Despite Mountain View contributing 23% of total gross absorption in the South Peninsula, 68% of Mountain View’s gross absorption was from the confidential deal listed above.
South Peninsula R&D Market Report
The South Peninsula market recorded 666,760 square feet of gross absorption in the fourth quarter of 2024, marking the third consecutive quarter to exceed the five-year leasing average. Also recording a positive net absorption of 230,248 SF across the South Peninsula market. All 5 of the largest R&D transactions were from AI or Life Science companies, highlighting the continued dominance of these sectors in the market. The top 10 largest transactions were direct leases, reflecting a trend away from subleases due to diminishing space availability in the sublease market.
Download South Peninsula R&D Market Report 4Q24