Sacramento, CA - Office Market Overview
The Sacramento Metropolitan Area includes the Campus Commons, Gateway Center, and Midtown Sacramento office space submarkets. With a metropolitan population of nearly 2.3 million, Sacramento is the state capital of California and the sixth-fastest growing city in the state. The technology, health care, and government sectors all provide consistently strong demand for white-collar office employment in Sacramento.
As of mid-2017, the Greater Sacramento office market encompasses over 37 million square feet of existing office space in properties larger than 50,000 square feet. The city's centralized Northern California location and government nexus attracts companies in the technology & energy, advanced manufacturing, and business & financial services, that generate robust demand for office space in the Sacramento commercial real estate market.
Sacramento, CA - Office Inventory Description
Both public and private industries are attracted to Sacramento's strategic location, skilled workforce, and affordable cost of doing business. With a gross metropolitan product of over $128 billion annually, the demand for white-collar office space in Sacramento remains strong. Nearly 64% of the office space in Sacramento is Class A or A+, while Class B office space adds another 55% of inventory to the market.
The Downtown Sacramento office market is one of the fastest-growing office submarkets in the city. Situated along I-5 and the Sacramento River, the area is home to prime Class A office property such as the U.S. Bank Tower, 1201 K Street, and the Wells Fargo Center at 400 Capitol Mall.
Sacramento, CA Commercial Inventory Breakdown
Office Spaces
Total: 45,151,400 SF
By square footage range:
- 50k to 100k SF: 9,424,588 SF / 20.87% of total office
- 100k to 500k SF: 25,765,517 SF / 57.06% of total office
- 500k to 1M SF: 6,672,534 SF / 14.78% of total office
- > 1M SF: 3,288,761 SF / 7.28% of total office
By class:
- Class A+: 2,045,641 SF / 4.53% of total office
- Class A: 16,399,985 SF / 36.32% of total office
- Class B: 21,781,663 SF / 48.24% of total office
- Class C: 1,299,756 SF / 2.88% of total office
Sacramento, CA - Green Office Space
Of the Top 30 Green Office Markets in the U.S., Sacramento ranks #22 for energy-efficient office buildings. While over 3% of the office buildings larger than 50,000 square feet are LEED-certified, just over 9% rank as Energy Star-rated and nearly 11% are recognized as green buildings.
The Lincoln Plaza East & West office buildings in Downtown Sacramento are brilliant examples of green offices. Built in 2005, this over 538,000-square-foot project has received the prestigious LEED Platinum certification. As tenants, national and global investors seek out green certified office assets for their use and portfolios, the green office trend will continue to grow in Sacramento.
The National Green Building Adoption Index for 2017 surveyed the top 30 major U.S. markets, looking at the percentage of energy efficient buildings. Sacramento has placed 22nd on this survey, which includes EPA Energy Star-rated properties. Since 2005 the percentage of green certified buildings has increased from 5% to 38% mid-2017.
Sacramento, CA's Top Office-Using Sectors
Sacramento's centralized location, attractive business climate, and diverse mix of business and industry all continue to create demand for commercial real estate in Sacramento. The health care, government, and educational sectors are some of the primary job creators of white-collar employment and users of Class A office space.
- Health Care – Companies such as Sutter Health, the UC Davis Health System, Kaiser Permanente, and Dignity Health all create demand for Class A office space in Sacramento.
- Government – Demand for office space in the metro area is created by government institutions such as the State of California, Sacramento County, the City of Sacramento, and the three unified school districts in the area.
- Higher Education – Sacramento is home to California State University, with the University of California - Davis, and the UC Davis Medical Center nearby.
- Corporate Offices – The demand for white-collar Class A office space in Sacramento is also driven by companies such as Blue Diamond Growers, Aerojet, Teichert, and the McClatchy Company.
Sacramento Demographics
Population
- Total Population489,650
- Male Population(48.8 %) 238,935
- Female Population(51.2 %) 250,715
- Median Age34.30
Income/Financial
- Average Household Income$74,469
- Median Household Income$54,615
- Median Income Under 25$24,138
- Median Income 25-44$57,418
- Median Income 45-64$62,390
- Median Income Over 65$44,902
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