Marking the third quarter in a row of increased vacancies, the slowdown in the demand for office space is not a surprise, Colliers International has announced based on its mid-year national office research report. Total negative absorption for the year now stands at about 5.1 million. In the second quarter, Class A vacancy rates have grown half a percentage point to 12.69 percent, and both B and C class rates have risen to 13.71 percent. \u201cIf you just look at Manhattan \u2013 year-to-date the negative absorption is about 6 million,” Ross Moore (pictured), executive vice president and director of market and economic research at Colliers in Boston, told CPN. That said, “if you think of what\u2019s going on in Wall Street \u2013 we actually have positive absorption (nationally).” His main point is, if you exclude New York, the office market is holding up quite well, considering what\u2019s going on with jobs, financial services and housing. In addition to Manhattan, other markets surveyed that show pronounced weakness include suburbs of Los Angeles, Las Vegas, San Jose, and Orange County. Those showing less signs of weakness but still showing declines include suburban Atlanta, suburban Chicago, and suburban Orlando. \u201cThe suburbs are slowing more quickly,\u201d said Moore. \u201cIt\u2019s a ratio of two to one.” That\u2019s where the construction is, unfortunately. In an absolutely perfect world, you wouldn\u2019t have any new construction coming on when demand is effectively zero, Moore added, \u201c That\u2019s the only thing that I am surprised about \u2013 that we\u2019re not seeing a quicker drop-off in construction than we are, with what\u2019s going on in the economy today\u2026such as the difficulty in getting debt financing.\u201d Almost 85 percent of new construction in the last quarter was in suburbia. But that isn’t always a problem. For example, both suburban Dallas and suburban Houston showed healthy office demand. And even suburban Boston and suburban Kansas City showed some growth in office demand.Class A downtown rents are now at an average of $49.40 (per square foot) and national average rent for suburban office space is at $27.72 per square foot. \u201cDo we think that the office market will slow further? We do,\u201d said Moore .<\/p>\n","protected":false},"excerpt":{"rendered":"
Marking the third quarter in a row of increased vacancies, the slowdown in the demand for office space is not a surprise, Colliers International has announced based on its mid-year national office research report. Total negative absorption for the year now stands at about 5.1 million. In the second quarter, Class A vacancy rates have…<\/p>\n","protected":false},"author":1314,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1003828817","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"acf":[],"yoast_head":"\n