Thursday, October 13, 2011

Market Trend: U.S. Office Vacancy Decreases to 12.5%

"The U.S. national office market ended the third quarter 2011 with a vacancy rate of 12.5%, down slightly from the 12.6% reported at the end of the second quarter 2011 and 12.7% in the end of the first quarter.

Net absorption for the overall U.S. office market was positive 23.7 million square feet in the third quarter, up significantly from positive 9.4 million square feet in the second quarter 2011. Vacant sublease space decreased in the quarter, ending the quarter at 52.6 million square feet.

Tenants moving out of large blocks of space in 2011 include AT&T Wireless moving out of 376,350 square feet at Cobalt Center in Atlanta, and Deloitte moving out of 295,136 square feet at 50 Fremont St. in San Francisco. Tenants moving into large blocks of space in 2011 include Facebook moving into 1 million square feet at the new Menlo Park campus in the San Francisco market, and Northrop Grumman moving into 328,851 square feet at Park Tower in the Washington, DC market.

The average quoted asking rental rate for available office space, all classes, was $21.30 per square foot per year at the end of the third quarter 2011 in the U.S. market area, a 0.1% decrease from the end of the second quarter.

A total of 182 buildings delivered to the nation-wide market in the quarter totaling 7 million square feet, with 50.7 million square feet still under construction at the end of the quarter including the 3-million-square-foot One World Trade Center in New York City."

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