Long Beach Office Market Report

Q2 2026 | Market Outlook & Leasing Trends

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Market Snapshot

• Downtown (CBD) Inventory: ~4.0M SF

• Suburban Inventory: ~4.0M SF

• CBD Vacancy: Mid-20% range (trending upward)

• Suburban Vacancy: ~22%

• Key Trend: Office inventory is contracting through conversion and redevelopment

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Downtown Long Beach (CBD)

The Downtown Long Beach office market remains under pressure, with the market yet to clearly establish a floor.

Vacancy is in the mid-20% range and rising, while asking rents have held relatively flat. In practice, however, effective rents continue to decline as landlords rely more heavily on concessions to attract tenants.

Leasing activity is being constrained by a lack of move-in ready space. Many landlords are unwilling to fund tenant improvements at today’s elevated construction costs, creating a gap between available space and tenant demand.

The “flight to quality” trend has largely played out, with incremental continuation, as most tenants have already upgraded and downsized.

A notable transaction this quarter was the sale of Landmark Square (460,000 SF) for approximately $50 million (~$108/SF), a roughly 63% discount. The buyer, Shomof Group, plans to convert the asset to residential—further evidence that obsolete office product is being removed from the market.

While the 2028 Summer Olympics will bring increased visibility to Long Beach, it is unlikely to materially impact near-term office fundamentals.

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Suburban Long Beach

The suburban office market remains relatively stable, but not immune to broader pressures.

Vacancy is approximately 22%, still elevated by historical standards, though demand continues to hold in stronger submarkets. Areas such as Douglas Park remain highly occupied (95%+), while Bixby Knolls is tracking near 18% vacancy.

As in the CBD, limited turnkey space and high tenant improvement costs (approaching $120/RSF for Class A) are slowing deal velocity.

At the same time, the Pacific Coast Highway corridor is undergoing a significant shift. Recent and planned projects are removing office inventory, including:

• ~150,000 SF of office demolition for residential development

• Conversion of Park Tower (~120,000 SF) to student housing

• Prior removal of Congressional Place (~74,000 SF)

These projects total approximately 350,000–370,000 SF of office space being removed from the market.

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Outlook

The Long Beach office market is increasingly defined by divergence between Downtown and suburban submarkets.

• Downtown faces continued pressure from elevated vacancy and weak demand

• Suburban markets remain comparatively stable, supported by location and functionality

At the same time, office-to-residential conversions are beginning to materially reduce supply, particularly in coastal and infill locations. If sustained, this trend may serve as a rebalancing mechanism over the medium term.