The Silicon Valley retail market in Q4 2025 recorded a slight decline in vacancy rates and stable rental pricing, while construction activity surged significantly year-over-year. Sales prices jumped sharply, and cap rates compressed, indicating strong investor confidence. Net absorption rebounded into positive territory, though no new deliveries occurred this quarter. Explore our full Silicon Valley retail market review for detailed insights and trends.
4Q 2025 Silicon Valley Market: Key Data Points
- Vacancy Rate Edges Lower: Retail vacancy decreased to 3.9%, down 10 bps from Q3 and up 20 bps year-over-year.
- Asking Rents Hold Steady: Average asking rent was $37.10/SF per year, a slight 0.88% decrease year-over-year.
- Construction Pipeline Surges: Space under construction soared to 247,285 SF, up 425.9% from last year.
- Sales Price Jumps: Average sales price climbed to $727/SF, marking a 24.6% year-over-year increase.
- Cap Rates Compress: Average cap rate fell to 5.3%, down 30 bps year-over-year.
- Net Absorption Turns Positive: Q4 absorption totaled 42,267 SF, reversing negative trends earlier in the year.
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