Orange County medical office fundamentals stabilize

Vacancy across Orange County medical office buildings held at 8.9% in the fourth quarter of 2025, marking a period of stabilization after volatility earlier in the year. Tenant occupancy expanded by more than 20,000 square feet during the quarter, nearly offsetting approximately 26,000 square feet of new supply completed. Occupancy has now increased for three consecutive quarters, reversing the sharp contraction recorded in the first quarter of 2025 that was partially driven by new vacancies at Bayview Corporate Center in Newport Beach. Despite this recent improvement, vacancies remained roughly 80 basis points above pre-pandemic levels and slightly higher than the trailing decade average.