Oakland (East Bay) Commercial Office Space for Rent

Q4 2025

Oakland/East Bay Commercial Real Estate Market Report

Focus: Q4 2025 Market Trends

Executive Summary

The Oakland/East Bay commercial real estate (CRE) market is navigating a complex recovery period in late 2025, with performance varying significantly by sector. The Office market continues to struggle with high vacancy, though some reports indicate a potential return to positive absorption after a long period of contraction [2, 3]. Industrial fundamentals are normalizing, with vacancy rates rising from historic lows as new supply enters the market, yet leasing activity remains robust in key corridors [4, 6]. Retail is showing stability with vacancy rates holding steady, while Multifamily is tightening as the construction pipeline slows, leading to renewed rent growth [1, 7].

TenantBase Proprietary Data [11] highlights the distribution of active tenant demand over the last 90 days (241 total deals):

  • Retail/Storefront led market activity with 58.92% of all searches [11].
  • Warehouse was the second most active sector at 38.59% [11].
  • Office accounted for 3.73% of total search volume [11].

Office Market

Market Overview The Oakland office market faces continued headwinds, with vacancy rates reaching new highs. However, recent data suggests a potential turning point with renewed leasing interest in prime locations.

  • Vacancy & Availability: The overall vacancy rate is reported between 22.6% and 24.6% for Q3 2025, reflecting continued downsizing and consolidation [2, 3]. Direct vacancy is lower but has risen to approximately 13.5% [5].
  • Net Absorption: Data is mixed, with some sources reporting negative absorption of -286,593 SF to -479,000 SF [2, 5]. However, others report the first quarter of positive absorption (+130,332 SF) in over three years, driven by activity in Downtown Oakland [3].
  • Rental Rates: Average asking rents have softened to $3.75 - $3.84 per SF (Full Service Gross) as landlords adjust pricing to attract tenants [2, 5].
  • Market Drivers: Leasing activity has been slow, but there is a noted uptick in requirements for high-quality, move-in-ready space [3].

TenantBase Activity [11]

  • Demand Share: Office accounted for 3.73% of total search volume [11].
  • Lease Term Preference: Due to low volume, trends are volatile, but 40.00% of inquiries sought terms of Less than one year [11].
  • Size Requirements: The average lower size requirement for office space is approximately 350 SF, reflecting a market dominated by small, local users [11].

Industrial & Warehouse Market

Market Overview The East Bay industrial market is cooling from its pandemic-era peak, with vacancy rising as new development outpaces demand in the short term.

  • Vacancy & Rent: Vacancy rates have increased to between 7.2% and 8.4% [4, 6]. Asking rents have dipped slightly to $1.34 - $1.66 per SF (NNN) depending on the asset class and location [4, 6].
  • Demand & Supply: Net absorption figures vary, with some reports showing negative -169,485 SF while others indicate positive absorption of +163,938 SF, driven by large leases in Oakland and Newark [4, 6].
  • Construction: The construction pipeline has paused in some submarkets, with zero new starts reported in Q3, which should help stabilize vacancy heading into 2026 [6].
  • Leasing Highlights: Leasing activity remains healthy, with year-to-date volume reaching 6.48 million SF, a 36% increase over the previous year [6].

TenantBase Activity [11]

  • Demand Share: Warehouse accounted for 38.59% of total search volume [11].
  • Lease Term Preference: Demand is balanced, with 39.13% of tenants seeking 3-5 Years and 32.61% seeking 1-2 Years [11].
  • Size Requirements: Tenants seeking 3-5 Year leases have an average lower size requirement of 3,438 SF [11].

Retail Market

Market Overview Oakland's retail sector is demonstrating resilience, with steady vacancy rates and consistent demand for neighborhood centers.

  • Vacancy & Availability: The retail vacancy rate held steady at 5.4% in Q3 2025, a slight improvement year-over-year [8]. Other reports place shopping center vacancy slightly higher at 7.3% [9].
  • Rental Rates: Average asking rents are approximately $2.44 per SF (NNN), showing a modest decline as the market adjusts [8].
  • Construction: Retail construction activity has slowed, with deliveries down 46% year-over-year, limiting new supply pressure [8].

TenantBase Activity [11]

  • Demand Share: Retail/Storefront activity dominated with 58.92% of all search volume [11].
  • Lease Term Preference: Retail tenants prefer stability, with 31.48% seeking 3-5 Years and 31.48% seeking 5+ Years [11].
  • Top Locations: Tenant interest is highest in Oakland (11 deals), Hayward (9 deals), and Dublin (8 deals) [11].

Multifamily Market

Market Overview The multifamily market is strengthening as the supply of new units tapers off, leading to tighter vacancy and renewed rent growth.

  • Vacancy & Occupancy: The vacancy rate dropped to 4.9% in Q3 2025, down 60 basis points year-over-year [1]. Some sources report even tighter vacancy at 3.8% [7].
  • Rents: Average asking rents rose 3% to $2,692 per month, with effective rents reaching as high as $3,212 [1, 7].
  • Construction: The number of units under construction fell 35% year-over-year to 13,353, signaling a significant slowdown in future supply [1].
  • Investment: Sales activity has picked up, with price per unit increasing 6% to over $331,000, reflecting growing investor confidence [1].

2026 Outlook

Looking ahead to 2026, the Oakland/East Bay market is positioned for a "balanced recovery."

  • Industrial Tightening: With the construction pipeline paused, any sustained increase in demand is expected to quickly absorb existing space, potentially driving rents back up by mid-2026 [6].
  • Multifamily Growth: The sharp decline in new construction starts will likely exacerbate the housing shortage, supporting continued rent growth and lower vacancy rates [1].
  • Office Stabilization: While the office sector faces a long road to recovery, the recent positive absorption figures suggest the market may be finding a floor, particularly for high-quality assets [3].

Sources

  1. Kidder Mathews: Bay Area Multifamily Market Report Q3 2025
  2. CBRE: Oakland Office Figures Q3 2025
  3. Newmark: Greater Oakland Office Market Overview Q3 2025
  4. CBRE: Oakland Industrial Figures Q3 2025
  5. Kidder Mathews: East Bay Office Market Report Q3 2025
  6. Kidder Mathews: East Bay Industrial Market Report Q3 2025
  7. CBRE: Bay Area Multifamily Figures Q3 2025
  8. Kidder Mathews: East Bay Retail Market Report Q3 2025
  9. Cushman & Wakefield: East Bay Retail MarketBeat Q3 2025
  10. Newmark: East Bay Industrial Market Overview Q3 2025
  11. TenantBase Proprietary Market Data (Oakland - Last 90 Days)

Information in this report is aggregated from various third-party sources and synthesized using artificial intelligence and other research tools. While we believe these sources to be reliable, we cannot guarantee the absolute accuracy or completeness of the data. This report is intended for informational purposes to provide market insight and should be independently verified prior to any use in a real estate transaction or legal commitment.