Huntington Beach, California, affectionately known as “Surf City USA,” is a vibrant coastal city in Orange County with a dynamic real estate market. Within this bustling locale, Huntington Harbor stands out as a prestigious enclave known for its waterfront properties, luxury living, and proximity to the Pacific Ocean. The commercial real estate (CRE) market in Huntington Harbor and the broader Huntington Beach area has seen significant shifts in recent years, driven by economic resilience, tourism, remote work trends, and regulatory changes. This blog post delves into the key trends shaping the commercial real estate landscape in Huntington Harbor and Huntington Beach as of 2025, offering insights for investors, landlords, and businesses looking to capitalize on opportunities in this sought-after market.
Overview of the Huntington Beach Commercial Real Estate Market
Huntington Beach’s commercial real estate market encompasses a diverse range of property types, including office spaces, retail centers, industrial properties, and multifamily units. The city’s appeal as a tourist destination, coupled with its strong economic foundation in sectors like technology, tourism, and manufacturing, creates a robust environment for commercial investments. Huntington Harbor, a submarket within Huntington Beach, is particularly notable for its high-end residential and commercial properties, often catering to affluent residents and businesses seeking proximity to the waterfront.
In 2024, the Huntington Beach commercial real estate market recorded approximately 726,032 square feet of commercial space across 93 properties, with leasing opportunities including 115 office listings, 23 industrial and warehouse listings, and 64 retail space listings. This diversity underscores the market’s versatility, offering opportunities for various types of commercial ventures.
Key Commercial Real Estate Trends in Huntington Harbor and Huntington Beach
1. Office Space Dynamics: Rising Vacancy Rates and Declining Rents
The office market in Huntington Beach, including Huntington Harbor, has experienced notable shifts in recent years. In 2024, the average asking rent for office space in Huntington Beach was $23.37 per square foot, reflecting a year-over-year decline of 3.38%. The overall office vacancy rate stood at 24.59%, with Huntington Harbor’s submarket showing a higher vacancy rate of 28.29% compared to Seal Beach’s 7.97%. These figures suggest a softening in demand for traditional office spaces, likely influenced by the rise of remote and hybrid work models.
Huntington Harbor’s office properties, such as the Huntington Harbor Plaza at 4952 Warner Ave, offer a range of leasing opportunities, with 11 spaces totaling 14,259 square feet available at rates between $1.25 and $15.00 per square foot per year. Despite the high vacancy rates, the area’s appeal as a premium location with waterfront access continues to attract businesses seeking prestigious addresses. However, landlords may need to offer competitive pricing or incentives to fill vacant spaces, especially as businesses prioritize flexibility in lease terms.
Investment Opportunity: Investors might consider repositioning office properties to cater to coworking spaces or flexible office solutions, which are gaining traction in response to remote work trends. Properties like the Bella Terra Medical building at 7677 Center Avenue, with 1,099 square feet available, could be ideal for medical or professional services targeting the affluent Huntington Harbor demographic.
2. Retail Sector: Stability and Demand for Coastal Amenities
Retail properties in Huntington Harbor and Huntington Beach remain a strong segment of the commercial real estate market, driven by the area’s tourism and lifestyle appeal. Retail spaces, such as the Beach Garfield Shopping Center at 19065-19111 Beach Blvd (25,097 square feet) and Pierside Pavilion at 300 Pacific Coast Hwy (90,000 square feet), benefit from high foot traffic and proximity to popular coastal attractions. The average asking rent for retail spaces in Huntington Beach is $38.40 per square foot, reflecting the premium placed on locations with strong consumer demand.
Huntington Harbor’s retail market is particularly vibrant due to its affluent resident base and steady influx of tourists. Properties like the Promenade Shopping Center at 16490 Bolsa Chica Street, with 1,238 square feet available, cater to boutique retailers and dining establishments that align with the area’s upscale lifestyle. The demand for experiential retail—such as restaurants, cafes, and wellness centers—continues to grow, as consumers prioritize experiences over traditional shopping.
Investment Opportunity: Retail investors should focus on properties that offer unique amenities or are located in high-traffic areas like Downtown Huntington Beach or Huntington Harbor. Short-term leases for pop-up shops or seasonal businesses could also capitalize on the area’s tourism-driven economy.
3. Industrial and Warehouse Spaces: Limited Supply and Steady Demand
The industrial and warehouse segment in Huntington Beach, including Huntington Harbor, is characterized by limited supply and consistent demand. In 2024, industrial spaces averaged $19.79 per square foot in asking rent, with 28 listings totaling 1,334,489 square feet. Properties like 17622 Metzler Ln (11,700 square feet) and 14801 Able Lane (100,741 square feet) highlight the availability of industrial spaces for lease, with rates ranging from $1.40 to $1.95 per square foot per month.
Huntington Harbor’s proximity to major transportation corridors and ports makes it an attractive location for logistics and distribution businesses. However, the lack of new construction in recent years has constrained supply, driving competition for available spaces. This scarcity could lead to upward pressure on rental rates in the coming years, particularly for well-located properties.
Investment Opportunity: Investors with an eye on industrial properties should consider acquiring existing assets for repositioning or redevelopment. The limited supply and growing demand for e-commerce and last-mile delivery facilities present opportunities for long-term appreciation.
4. Multifamily Market: Low Vacancy and Rising Rents
The multifamily sector in Huntington Beach, including Huntington Harbor, remains a standout performer. In Q3 2022, the vacancy rate for multifamily properties was a low 2.0%, with rents increasing by 6.8% year-over-year, significantly outpacing the 10-year average growth rate of 4.5%. The average rent for apartments in Huntington Beach is approximately $2,600 per month, aligning with Orange County’s broader market trends.
Huntington Harbor’s multifamily properties, such as the 7601 Amazon Drive property (4,404 square feet), are highly sought after due to their waterfront locations and proximity to amenities. The area’s low vacancy rates and strong rental growth reflect robust demand from professionals, retirees, and seasonal residents. However, the lack of new multifamily developments in recent years has tightened supply, further driving rent increases.
Investment Opportunity: Multifamily properties in Huntington Harbor offer stable cash flow and potential for appreciation, particularly for luxury rentals catering to high-income tenants. Investors should explore opportunities in older properties for renovation or conversion to short-term rentals, given the area’s appeal to tourists.
5. Regulatory and Environmental Considerations
Huntington Beach’s commercial real estate market is heavily influenced by regulatory and environmental factors. The California Coastal Commission imposes strict regulations on properties near the beach, particularly in Huntington Harbor, affecting development and renovation projects. Additionally, new housing mandates require Huntington Beach to plan for over 13,000 new homes by 2030, which could impact commercial development by increasing competition for land.
Environmental sustainability is also a growing trend, with businesses and tenants prioritizing eco-friendly features like solar panels and energy-efficient systems. Properties that incorporate sustainable technologies or community-focused amenities, such as co-working spaces or wellness centers, are likely to attract higher demand.
Investment Strategy: Investors should stay informed about local regulations and consider incorporating sustainable features into their properties to enhance appeal and comply with evolving standards.
6. Technology and Market Adaptation
Technology is reshaping the commercial real estate landscape in Huntington Beach. Virtual tours and smart building technologies are becoming standard, particularly for office and retail properties. In Huntington Harbor, where luxury and convenience are paramount, properties with integrated smart systems—such as automated lighting or security—are increasingly desirable.
Blockchain technology is also emerging as a potential game-changer for real estate transactions, offering transparency and security. While still in its early stages, its adoption could streamline leasing and sales processes in the coming years.
Investment Strategy: Landlords and developers should invest in smart technologies to differentiate their properties and attract tech-savvy tenants. Offering virtual tours can also broaden the reach to prospective tenants and buyers.
Huntington Harbor: A Neighborhood Spotlight
Huntington Harbor remains a crown jewel of Huntington Beach’s real estate market. Known for its luxury waterfront properties and exclusive lifestyle, the area commands premium prices for both residential and commercial real estate. In 2024, Huntington Harbor had 94 homes for sale, with a median price per square foot of $1,002 and a median days on market of 64. Commercial properties in the area, such as the Huntington Harbor Plaza, benefit from the neighborhood’s affluent demographic and limited inventory, driving strong demand for retail and office spaces.
The area’s proximity to the harbor and coastal amenities makes it a hotspot for businesses catering to high-net-worth individuals, such as boutique retailers, upscale dining, and professional services. However, the high cost of entry and regulatory constraints on new development mean that opportunities are competitive and require strategic planning.
Future Projections for 2025 and Beyond
Looking ahead to 2025, the commercial real estate market in Huntington Harbor and Huntington Beach is expected to remain competitive, with moderated growth in property values and rents. Key projections include:
-
Office Market: Continued softening in demand for traditional office spaces, with vacancy rates potentially stabilizing as businesses adapt to hybrid work models. Creative leasing strategies, such as short-term or flexible leases, could help fill vacancies.
-
Retail Market: Steady demand for retail spaces, particularly in high-traffic areas like Huntington Harbor, driven by tourism and local spending. Experiential retail will remain a priority.
-
Industrial Market: Limited supply will continue to drive competition, with potential for rental rate increases. Investors should monitor opportunities in logistics and distribution.
-
Multifamily Market: Strong demand and low vacancy rates will persist, with rents likely to see modest increases. Short-term rentals in Huntington Harbor could offer high returns due to tourism.
-
Economic Factors: Stabilization or slight increases in interest rates may impact affordability, but Huntington Beach’s economic resilience will support long-term growth.
Strategies for Investors and Landlords
To succeed in Huntington Harbor’s commercial real estate market, investors and landlords should consider the following strategies:
-
Diversification: Balance investments across property types (office, retail, industrial, multifamily) to mitigate risks associated with market fluctuations.
-
Repositioning Assets: Renovate older properties to meet modern demands, such as adding sustainable features or converting office spaces to coworking environments.
-
Leveraging Tourism: Focus on retail and multifamily properties that cater to tourists and seasonal residents, particularly in Huntington Harbor.
-
Staying Compliant: Monitor regulatory changes, especially coastal and housing mandates, to ensure compliance and avoid costly delays.
-
Embracing Technology: Invest in smart building technologies and virtual tour capabilities to attract tenants and streamline operations.
Conclusion
The commercial real estate market in Huntington Harbor and Huntington Beach is poised for nuanced growth in 2025, driven by the area’s coastal allure, economic stability, and limited inventory. While challenges such as high vacancy rates in the office sector and regulatory constraints persist, opportunities abound in retail, industrial, and multifamily properties. Huntington Harbor, with its luxury appeal and waterfront charm, remains a prime target for investors seeking high-value assets. By staying informed about market trends, embracing technology, and adopting strategic investment approaches, stakeholders can navigate this competitive landscape and capitalize on the unique opportunities that Huntington Harbor and Huntington Beach offer.
Whether you’re an investor, landlord, or business owner, understanding these trends and adapting to the evolving market will be key to success in one of California’s most desirable coastal communities.
