In the middle of a challenging market, particularly for office properties, Hacienda had a good year of activity that also holds promise for 2025 as well.

Year over year figures showed an overall decrease in vacancy from 15.73% to 15.22% by the end of the year. While quarter-over-quarter figures fluctuated throughout 2024, the end of the year saw a positive 43,921 square feet of net absorption. Total occupancy began at 6,854,674 at the beginning of the year and increased to a total of 6,898,595 by the end of December. No different than many other office markets, Hacienda saw challenges throughout the year with corresponding losses of tenancy in the office sector. However, these losses were more than offset by the completion of two of the largest 2024 leases in the Interstate 680 corridor executed with Sutter Health and ACCO Engineering solutions. This activity, in addition to several other transactions, produced the net gain in occupancy noted. While the underlying challenges in the office market have not abated, there are continued signs that additional positive gains will be realized in 2025. 

Most of that activity came from tenants occupying less than 10,000 square feet, which accounted for 95.45% of all transactions and 38.13% of the total volume of occupied space. 3.25% of deals were in larger spaces between 10,000 and 50,000 square feet, accounting for 23.86% of all space occupied during the year. 1.3% of transactions for the year took place in occupancies over 50,000 square feet and accounted for 38.01% of the total volume. As has been seen recently, the business services sector comprised the largest portion of Hacienda’s occupied space, at 1,823,342 square feet. Biomedical companies accounted for 1,163,099 square feet, various forms of manufacturing occupied 471,322 square feet, and health practitioners occupied 392,522 square feet. Other notable industries at Hacienda last year included retail, hotels, education, and consumer goods, providing a diverse group of tenants that reflects the wealth of employment opportunities across the Bay Area. The following tables provide a general overview of activity in Hacienda during 2024, including highlights of selected projects at various sites, tenant activity, and property sales.

2024 Development Activity (Approved, Under Construction, or Completed)

2024 saw the return of new construction to Hacienda. In addition to a variety of tenant improvements made or commenced for new businesses, for the first time in several years, new buildings began to enter the Hacienda landscape. The first phase of a three-product type residential project commenced construction in 2024. The residential project was joined by a companion project, immediately adjacent, for a new premier childcare facility. Both projects are located on Owens Drive just south of Rosewood Drive and are being developed on a portion of the parking field for the larger Rosewood Commons office complex. Below is a summary of development activity for the year.

Construction activity in support of new tenancy was also present during 2024. In addition to projects being completed that had commenced the year prior, many new notable improvements began last year as well.

Major Tenant Activity

Notable tenants that leased space at Hacienda last year included ACCO Engineered Systems, Sutter Health and Sunbelt Controls. Hacienda saw just over 345,000 square feet of activity in 2024. The majority of transactions involved less than 10,000 square feet but accounted for almost 40% of the space occupied. Larger spaces occupied were a smaller percentage of the total number of transactions but contributed significantly to the total amount of space occupied over the year.

2024 Sales Activity

2024 saw the resumption of limited sales activity. Standing in stark contrast to 2022, no sales occurred during 2023. While a number of sales were transacted for both users and investors during 2022, neither of these groups produced sales activity during 2023. 2024 saw one sale at the beginning of the year and changing dynamics in the investment market suggest more sales will be seen in 2025.