Philadelphia's Office Vacancy Decreases to 11.6%

The Philadelphia Office market ended the second quarter 2013 with a vacancy rate of 11.6%. 

The vacancy rate was down over the previous quarter, with net absorption totaling positive 780,268 square feet in the second quarter. That compares to negative 133,015 square feet in the first quarter 2013. Vacant sublease space increased in the quarter, ending the quarter at 1,355,431 square feet. 

Tenants moving into large blocks of space in 2013 include: GlaxoSmithKline moving into 205,000 square feet at Five Crescent Dr; Drexel University moving into 117,464 square feet at Three Parkway; and Philadelphia Parking Authority moving into 83,252 square feet at Mellon Independence Center. 

Rental rates ended the second quarter at $21.05, an increase over the previous quarter. 

A total of three buildings delivered to the market in the quarter totaling 23,100 square feet, with 790,192 square feet still under construction at the end of the quarter. 

This trend is compared to the U.S. National Office vacancy rate, which decreased to 11.7% from the previous quarter, with net absorption positive 21.27 million square feet in the second quarter. Average rental rates increased to $21.60, and 219 buildings delivered to the market totaling more than 10.25 million square feet. 
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