Office market in Southern California market now softening

The commercial real estate market, which was once thought somewhat immune to the bust of the residential sector, is now starting to feel the pinch from a slowing economy. First it was the retail sector -- which relies on consumer spending -- and now it's starting to impact office rents and vacancy levels in preferred areas of Southern California also once considered more resilient. From an LATimes story:

In a sign that the economic slowdown is affecting Southern California businesses, the rents on office space are down slightly over last year, and vacancy rates are up.

In some parts of the region, office buildings that once housed mortgage lenders and other housing-related businesses stand 20% empty, according to brokerage Cushman & Wakefield. Even in desirable Santa Monica, vacancies have almost doubled as companies have shunned the coastal area's still-pricey digs in favor of cheaper rents elsewhere in the region.

Experts say the decline in rents and the jump in vacancies portend trouble, even in those parts of the region -- such as L.A.'s Westside -- where the market is still relatively stable...

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