2011 National Market Overview

Transcription

2011
TABLE OF CONTENTS
NATIONAL MARKET OVERVIEW
SECTION I - INTRODUCTION
03
Introduction
04
National Market Summary
06
Statistical Summary
2
SECTION II - CITY STATISTICS
07
Atlanta, GA
08
Birmingham, AL
09
Chicago, IL
10
Colorado Springs, CO
11
Dallas, TX
12
Denver, CO
13
Fort Myers, FL
14
Fort Worth, TX
15
Hampton Roads, VA
16
Kansas City, MO
17
Los Angeles, CA
18
Miami, FL
19
Milwaukee, WI
20
New York, NY
21
Northern New Jersey
22
Oklahoma City, OK
23
Orange County, CA
24
Phoenix, AZ
25
Portland, OR
26
Richmond, VA
27
San Antonio, TX
28
San Diego, CA
29
San Francisco Bay Area, CA
30
St. Louis, MO
31
Washington, D.C.
The National Market Overview is published by
MB Real Estate, an active member of the CORE Network.
To obtain additional copies or for further information,
please contact:
Andrew J. Davidson
SECTION III - ADDITIONAL INFORMATION
32
Industrial Services
33
Board of Directors
EVP/Managing Director of Corporate Services &
Tenant Advisory at MB Real Estate
181 West Madison Street, Suite 4700
Chicago, Illinois 60602
p: 312 726 1700
www.mbres.com
ADDITIONAL INFORMATION INCLUDED IN THIS REPORT WAS PROVIDED BY COSTAR GROUP WWW.COSTAR.COM
INTRODUCTION
2 0 1 1
NATIONAL MARKET OVERVIEW
The National Market Overview was created to spotlight many of the active commercial real estate markets in U.S. cities
within the CORE Network.
WHAT IS THE CORE NETWORK?
CORE Network is an over 20-member organization of mid-sized commercial real estate companies that are hand
selected to provide a full line of commercial real estate services to clients. With an international geographic reach and
a full line of service capabilities, CORE is often compared to some of the largest commercial real estate providers in
the industry.
CORE offers its clients comprehensive real estate investment, management, development, strategic planning, tenant
representation, acquisition, disposition, and financial services. It meets the varying requirements of its members’
clients by employing the expertise of industry-specific account teams and handpicked specialists from its growing body
of member firms. This collective effort enhances the overall capabilities of CORE; however, each member is
empowered and committed to providing its own clients with a single-point-of accountability. Member clients therefore
have the best of all worlds, the capabilities and services of a highly organized Network with the flexibility and
customization of a single-source provider. Please visit www.corenetworkcre.org for more information. ■
3
NATIONAL MARKET SUMMARY
2 0 1 1
OVERVIEW AND OUTLOOK
The United States economy continued its slow recovery in 2011 as commercial real estate fundamentals showed
improvement. Of the 24 markets that CORE Network affiliates track, 20 markets experienced positive net absorption.
18 out of 24 markets experienced a decrease in unemployment rate. But total employment in the United States is still
4.4 percent below peak 2007 levels, which continues to place pressure on the office market.
After remaining unchanged in 2010, CoStar’s National Office total vacancy rate fell 110 basis points to 12.3 percent.
While a solid improvement, the total vacancy rate is still well above the 10.6 percent level seen in 2006. Total net
absorption from markets that CORE Network affiliates track exceeded a positive 21 million square feet in 2011. A lack
of new, speculative construction continued to aid the market. Only 31.8 million square feet of office space was delivered
in 2011—the lowest yearly amount in more than 30 years. This is well below the historical average of roughly 150
million square feet. Another positive sign is that total available sublease space has fallen from 61.1 million square feet
at the end of 2010 to 50.7 million square feet at the end of 2011. This 20.5 percent reduction is further evidence of
increased corporate confidence and a recovering office market.
Despite an improvement in leasing activity and occupancy, average asking rental rates remain down nationally, on a
year-over-year basis. The average asking rate for Class A was $26.85, compared to $26.96 at the end of 2010. Class
B and C average asking rates also decreased to $19.56 and $16.04, compared to $19.70 and $16.43, respectively,
at the end of 2010. However, several costal markets including New York, San Francisco and Portland all reported
increased asking rental rates in 2011, indicating that the trend may spread inland in 2012.
4
Through the first three quarters of 2011, total sales
volume reached $39.9 billion, compared to $19.6
billion over the same timeframe in 2010. The average
cap rate dropped from 8.49 percent in 2010 to 8.13
percent. Cap rates have compressed in major central
business districts, evidenced by the 3.39 percent cap
rate resulting from the $1.77 billion sale of The Port
of New York Authority Inland Terminal in New York City.
The bifurcation of suburban and central business
district markets became even more pronounced. More
than 900,000 square feet of positive absorption in
Chicago’s CBD was overshadowed by over 1.1 million
square feet of negative absorption in the suburbs. On
the other hand, Oklahoma City’s suburban market is
much tighter than its downtown, with direct vacancies
of 13.1 percent compared to 26.4 percent.
Markets with Largest Year-Over-Year Unemployment
Rate Decrease
Market
Unemployment Rate
Miami, FL
Portland, OR
Kansas City, MO
St. Louis, MO
10.0%
8.6%
9.1%
7.8%
8.6%
Decrease
-1.8%
-1.2%
-1.0%
-0.9%
-0.8%
Markets with Largest Year-Over-Year Unemployment
Rate Increase
Market
Unemployment Rate
Chicago, IL
San Antonio, TX
Fort Worth, TX
Hampton Roads, VA
New York, NY
9.6%
7.5%
8.0%
7.0%
9.0%
Increase
0.7%
0.2%
0.0%
0.0%
0.0%
* Unemployment figures from the Bureau of Labor Statistics - non-seasonally adjusted
The national recovery will continue to slowly take shape 2012. New construction will remain near record low levels.
More employers plan on adding jobs compared to the previous year, which should lead to increased leasing activity.
The “flight-to-quality” trend will continue in markets with elevated vacancy until landlords are in the position to raise
rental rates and reduce concessions. We expect the upcoming year to be similar to 2011 with a few more markets
showing increased signs of improvement.
Total Vacancy by Market - Year End 2011
30%
25%
20%
15%
10%
5%
Portland, O
OR
Richmond, VVA
San Francisco Bay Area, C
CA
New York, N
NY
Denver, C
CO
Kansas City, M
MO
Los Angeles, C
CA
Hampton Roads, VVA
Washington, D.C.
Miami, FL
Colorado Springs, C
CO
Fort Worth, TTX
Northern/Central N
NJ
Fort Myers, FL
San Diego, C
CA
Orange County, C
CA
St. Louis, M
MO
Birmingham, AAL
Oklahoma City, O
OK
Atlanta, G
GA
Milwaukee, W
WI
San Antonio, TTX
Dallas, TTX
Chicago, IL
Phoenix, AAZ
0%
5
OFFICE MARKET STATISTICAL SUMMARY
CORE Network 2011 Vacancy Summary
Size of Market (sf)
YTD Absorption
(sf)
Direct
Vacancy
%
Sublease
Vacancy
%
Total
Vacancy
%
Metropolitan
Unemployment
Rate (Oct '11)
Atlanta, GA
208,578,790
163,986
18.6%
1.0%
19.5%
9.9%
Birmingham, AL
17,804,986
117,496
14.0%
3.8%
17.8%
7.3%
Chicago, IL
242,899,322
-226,023
19.2%
2.6%
21.8%
9.6%
Colorado Springs, CO
27,542,895
697,000
14.2%
0.5%
14.7%
8.6%
Dallas, TX
203,837,074
2,138,206
20.9%
0.8%
21.7%
8.0%
Denver, CO
183,171,525
1,863,615
12.5%
0.5%
13.0%
7.8%
Fort Myers, FL
31,187,746
-49,812
-
-
16.4%
9.8%
Fort Worth, TX
43,135,818
-300,786
14.1%
1.7%
15.8%
8.0%
Kansas City, MO
107,472,022
541,000
12.9%
0.3%
13.3%
7.8%
Hampton Roads, VA
46,847,785
-200,159
13.2%
0.3%
13.5%
7.0%
Los Angeles, CA
372,611,580
280,454
12.8%
0.6%
13.3%
11.0%
Miami, FL
223,023,729
1,909,514
14.2%
0.3%
14.5%
10.0%
Milwaukee, WI
27,438,439
199,966
19.7%
0.8%
20.5%
7.4%
New York, NY
450,000,000
2,134,000
10.3%
2.0%
12.3%
9.0%
Northern/Central NJ
147,556,295
1,191,500
14.9%
1.5%
16.4%
8.3%
Oklahoma City, OK
14,675,890
322,403
18.2%
0.0%
18.3%
5.8%
Orange County, CA
110,936,466
926,659
16.1%
0.8%
17.0%
11.0%
Phoenix, AZ
80,557,161
1,074,850
25.1%
1.1%
26.2%
8.1%
Portland, OR
27,623,780
407,761
10.6%
0.7%
11.3%
8.6%
Richmond, VA
60,194,994
488,875
10.7%
0.7%
11.4%
6.8%
San Antonio, TX
25,463,935
-141,733
20.8%
0.5%
21.3%
7.5%
San Diego, CA
79,803,900
700,373
15.8%
0.8%
16.6%
9.7%
381,165,900
6,472,161
11.1%
0.9%
12.0%
9.1%
St. Louis, MO
50,989,837
-178,750
16.1%
1.0%
17.0%
8.6%
Washington, D.C.
325,459,013
760,184
13.0%
1.2%
14.2%
5.7%
Location
6
* Unemployment figures from the Bureau of Labor Statistics - non-seasonally adjusted
COMPILED BY MB REAL ESTATE WWW.MBRES.COM (312) 726 -1700
ATLANTA, GA
MARKET OVERVIEW
The Atlanta Office Market saw a drop in the overall
vacancy rate for the first time since 2006. The vacancy
rate fell to 19.5 percent, driven by 490,000 square
feet of net absorption in the fourth quarter. Currently
1.5 million square feet of office space is under
construction. Quoted rental rates averaged $19.32 at
the end of the fourth quarter, up from $19.11 in the
previous quarter. Though the vacancy rate is declining
and rental rates are up, tenants looking for space in
the current market still have the upper hand.
TRENDS & ECONOMIC CONDITIONS
The Georgia Department of Labor reports that the
preliminary unemployment rate for Metro Atlanta as
of November 2011 is 9.2 percent, down 1.3 percent
from June 2011. This drop can be attributed to the
more than 13,000 jobs added regionally as well as
fewer layoffs in construction, manufacturing,
wholesale trade, administrative support services and
accommodation & food services. The decline in the
Atlanta Office Market’s vacancy rate is indicative of
the recent stabilization of these sectors. ■
Largest Blocks Of Class A Space
Adddress
Size (sf))
Submarket
600 Peachtree St
3438 Peachtree Rd
1075 Peachtree St
950 E Paces Ferry Rd
55 Park Place
570,371
385,313
373,035
369,583
340,146
Downtown
Buckhead
Midtown
Buckhead
Downtown
7
Major New Developments
Adddress
Size (sf))
Delivery Date
675 NE Ponce De Leon Ave.
3120 Breckinridge Blvd
750,000
344,476
January 2014
April 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
66,369,069
142,209,721
208,578,790
200,411
(36,425)
163,986
Direct Vacancy
%
18.5%
18.6%
18.6%
Sublease Vacancy
%
1.1%
0.9%
1.0%
Total Vacancy
%
19.6%
19.5%
19.5%
Please note: Numbers in parentheses are negative.
Largest Tenant Transactions In 2011
Tenant
Submarket
Adddress
Size (sf))
Suntrust Bank
GE Consumer Finance
InComm
Coca Cola
Alston & Bird, LLP
Downtown
North Fulton
Downtown
North Fulton
Midtown
285 Peachtree Center Ave
Windward Plaza - Bldg 300
250 Williams St
Oak View III
One Atlantic Center
254,619
203,245
184,824
148,229
132,856
ACKERMAN & CO. WWW.ACKERMANCO.NET
BIRMINGHAM, AL
MARKET OVERVIEW
Birmingham ended the year with 117,500 square feet
of positive absorption. Only 2 out of the 6 submarkets
reported negative absorption, so hopefully the positive
trend will hit the overall market in 2012. Leasing
activity has been slow for new deals, but landlords
have made sure to keep existing tenants in place.
Rents are flat and renewing tenants are able to
negotiate market rates with reasonable refurbishment
improvement allowances. The only development
announcement is a 170,000 square foot building in
Midtown. Sublease space still presents problems and
is expected to weigh down the market in 2012.
Adddress
Size (sf))
Submarket
ATT Colonnade
Regions Plaza
Meadow Brook 300
Wells Fargo Tower
Woods point II
410,000
218,000
101,000
58,000
48,000
280/I-459
CBD
280/I-459
CBD
Hoover
8
The Birmingham metropolitan unemployment rate is
currently 7.3 percent compared to the national
average of 8.2 percent. The Birmingham market is
also being affected by the municipal bankruptcy of
Jefferson County. Birmingham is still growing in
healthcare sectors but is losing jobs related to
banking. The area is home to a dozen hospitals and
over 700 technology related companies. ■
Adddress
Size (sf))
Delivery Date
Colonial Brookwood 2
170,000
2nd Quarter 2013
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
CBD
Suburban
Total
3,971,562
13,833,424
17,804,986
18,023
99,473
117,496
Direct Vacancy
%
14.0%
14.0%
14.0%
Sublease Vacancy
%
3.0%
4.0%
3.8%
Total Vacancy
%
17.0%
18.0%
17.8%
Tenant
Submarket
Adddress
Size (sf))
FEMA (6 month; tornado relief)
Cahaba Govt Benefit (renewal)
Allstate (renewal)
Baker Donelson (renewal / expansion)
Brown Mackie College
CBD
280/I-459
280/I-459
CBD
Oxmoor
Regions Plaza
Meadow Brook 500
Meadow Brook South
Wells Fargo
Vulcan Building
140,000
135,000
75,000
67,700
50,000
HARBERT REALTY SERVICES WWW.HARBERTREALTY.COM
CHICAGO, IL
MARKET OVERVIEW
Leasing activity and absorption showed unexpected,
but marked improvement in Chicago’s CBD with direct
vacancy falling 90 basis points during 2011. Rental
rates grew slightly in Class A buildings as the “flightto-quality” trend continues. The Suburbs continued to
struggle and experienced more than 1.1 million
square feet of negative absorption. No speculative
construction is underway in the CBD or Suburbs.
The Chicago metropolitan unemployment rate is
currently 9.6 percent, well above the national average
of 8.2 percent. Despite a decline in total employment
of 6.2 percent since January 2008, the total amount
of occupied space is down just 0.3 percent in the
CBD. This is largely due to Chicago-based companies
such as Groupon rapidly expanding their space
requirements. Numerous tenants are relocating to the
CBD from the Suburbs as they desire access to the
younger labor force. However, due to jobs lost during
the recession and sluggish job growth, vacancy rates
are forecasted to increase slightly in 2012. ■
Adddress
Size (sf))
Submarket
500 W Monroe
200 E Randolph
233 S Wacker
111 W Illinois
10 S Dearborn
369,207
340,959
299,514
141,503
139,165
West Loop
East Loop
West Loop
River North
Central Loop
9
Adddress
Size (sf))
Delivery Date
1000 W Fulton (redevelop.)
400 S Jefferson (redevelop.)
450,000
304,000
January 2013
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
130,649,210
112,250,112
242,899,322
913,519
(1,139,542)
(226,023)
Direct Vacancy
%
15.4%
23.6%
19.2%
Sublease Vacancy
%
2.2%
3.0%
2.6%
Total Vacancy
%
17.6%
26.6%
21.8%
Tenant
Aon Corporation (Renewal)
GE Capital (Renewal/Expansion)
Wells Fargo (New)
PricewaterhouseCoopers (Renewal)
American Medical Association (New)
Submarket
Adddress
Size (sf))
East Loop
West Loop
West Loop
West Loop
North Michigan Ave
200 E Randolph
500 W Monroe
10 & 30 S Wacker
1 N Wacker
330 N Wabash
400,000
370,000
293,000
279,000
275,000
MB REAL ESTATE WWW.MBRES.COM
COLORADO SPRINGS, CO
MARKET OVERVIEW
Absorption reached 741,000 square feet in 2012.
However, it took 2.2 million square feet of leasing and
multiple owner-occupied building purchases to
produce this absorption figure. Even the healthy
leasing figure of 2.2 million included several hundred
thousand square feet of “charity leasing” to tax exempt
philanthropic entities.
Asking rental rates have been falling for the last three
years. However, many lease deals are being done at
25 to 40 percent below the published asking rates.
Previous downturns produced average asking rents in
the $5.50 triple net range, but the current asking rate
of $9.72 is not reflective of market conditions. For
whatever reason, there remains a concerted
reluctance to publicly advertise lower asking rents. ■
Adddress
Size (sf))
Submarket
9910 Federal Dr
9965 Federal Dr
565 Space Center Dr
555 Middle Creek
10807 New Allegiance Dr
100,000
100,000
90,099
90,000
60,936
Northeast
Northeast
Southeast
Northeast
Northeast
10
Adddress
Size (sf))
Delivery Date
NONE
Vacancy Rates
Location
697,000
Direct Vacancy
%
14.2%
Sublease Vacancy
%
0.5%
697,000
14.2%
0.5%
Size of Market (sf)
Net Absorption (sf)
City
27,542,895
Total
27,542,895
Total Vacancy
%
14.7%
14.7%
Tenant
Submarket
Adddress
Size (sf))
El Paso County
Children's Hospital
Aeroflex
Colorado Springs Conservatory
McGinnis/GMAC Real Estate
Northwest
Northeast
Northwest
CBD
Northeast
Garden of the Gods
Corporate Point
Garden Gateway Plaza - Bldg 2
Cimarron Law Building
Vantage Point
300,000
60,000
25,625
17,696
11,055
CAMERON BUTCHER COMMERCIAL REAL ESTATE WWW.CAMERONBUTCHER.COM
DALLAS, TX
MARKET OVERVIEW
The city market contains almost 33 million square feet
and is currently showing a vacancy rate of 29.5
percent, while the suburban market contains just over
173 million square feet and is showing a vacancy rate
of 21.8 percent. There currently is almost 460,000
square feet of new development to be completed
within the next year.
Business and consumer confidence remains low due
to the current economy, causing the market to operate
cautiously. There is a strong concern for the office
market as companies merge and put space on the
market for sublease. Recently, the completion of
vacant new office space has reduced or negated the
benefits of positive net absorption. Large office users
have streamlined their space needs and have vacated
large blocks of space in favor of newer, more efficient
layouts. ■
Adddress
Size (sf))
Submarket
13737 Noel Rd
5601 Legacy Dr
350 N Saint Paul St
1601 Elm St
1011 Galatyn Pkwy
378,203
354,482
301,391
299,005
280,800
Quorum/Bent Tree
Upper Tollway/West Plano
CBD
CBD
Richardson
11
Adddress
Size (sf))
Delivery Date
5851 Legacy Cir
315 E I-30
Stacy Rd @ State Hwy 121
281,600
110,000
100,000
July 2012
July 2012
December 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
29,467,747
174,369,327
203,837,074
(298,338)
2,436,544
2,138,206
Direct Vacancy
%
31.0%
19.3%
20.9%
Sublease Vacancy
%
1.0%
0.7%
0.8%
Total Vacancy
%
32.0%
20.0%
21.7%
Tenant
Fossil
Ericsson
JP Morgan Chase
American Home Mortgage
TracyLocke
Submarket
Adddress
Size (sf))
Richardson
Richardson
Lewisville
Quorum/Bent Tree
CBD
901 S Central Expy
2201-2221 Lakeside Blvd
2777 Lake Vista Dr
16675 Addison Rd
Harwood Center
535,771
460,000
240,000
137,992
111,548
SWEARINGEN REALTY GROUP, LLC WWW.SWEARINGEN.COM
DENVER, CO
MARKET OVERVIEW
The Denver Office market ended 2011 with a total
vacancy rate of 13.0 percent. The vacancy rate was
down over the previous quarter, with net absorption
totaling positive 556,275 square feet in the fourth
quarter. Vacant sublease space decreased in the
quarter, ending the quarter at 913,403 square feet.
Rental rates ended the fourth quarter at $19.78, an
increase over the previous quarter. A total of four
buildings were delivered in the quarter totaling
71,388 square feet, with 872,660 square feet still
under construction at the end of the quarter. ■
Adddress
Size (sf))
Submarket
1801 California St
1801 California St
1900 16th St
3190 S Vaughn Way
1801 California St
398,612
267,206
159,186
157,721
134,640
CBD
CBD
Platte River
Aurora
CBD
12
Adddress
Size (sf))
Delivery Date
Davita Headquarters
Eos
St. Anthony Medical Building II
270,000
185,000
100,000
3rd Qtr 2012
4th Qtr 2012
1st Qtr 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
33,134,886
150,036,639
183,171,525
312,384
1,551,231
1,863,615
Direct Vacancy
%
11.7%
12.7%
12.5%
Sublease Vacancy
%
0.8%
0.4%
0.5%
Total Vacancy
%
12.5%
13.1%
13.0%
Tenant
URS Corporation
Bridgepoint Education
Jacobs Engineering Group Inc.
Children's Hospital
ProBuild Company
Submarket
Adddress
Size (sf))
Denver Tech Center
CBD
CBD
Aurora
Denver Tech Center
Denver Corporate Center II
Park Central
707 17th St
Fitzsimons Village 100
Crossroads DTC
185,988
151,331
143,877
120,000
86,937
FORT MYERS, FL
MARKET OVERVIEW
The outlook for the Southwest Florida office market
indicates stability and additional improvement.
Overall vacancy rates are expected to remain
relatively stable, with a slight rise in vacancy rate
predicted. Leasing activity showed a positive
increase and quarter over quarter leasing followed
suit between the third and fourth quarters of 2011.
Unemployment in Southwest Florida continues to
decline. In Lee County alone, one of the hardest hit
areas in Florida, January 2011 rates were at 12.7
percent dropping to 11.6 percent in July and to
10.2 percent in December 2011. Topping 600,000,
Lee County’s population is now dominated by
working-age people. Forbes, Inc. and Money
magazines have recognized Cape Coral-Fort Myers
as one of the top places to live and do business in
the country. Lee and Collier counties saw a
decrease in the number of existing single-family
home sales, but an increase in the median price. ■
Adddress
Size (sf))
Submarket
University Park
Metro Centre
346,413
77,272
College Corridor
Metro North
13
Adddress
Size (sf))
Delivery Date
Eastlinks V (Gateway)
8860 Salrose Lane
56,700
29,837
1st Qtr 2012
1st Qtr 2011
Vacancy Rates
Location
City
Other
Total
Size of Market (sf)
YTD Absorption (sf)
4,764,648
26,423,098
31,187,746
(36,358)
(13,454)
(49,812)
Direct Vacancy
%
-
Sublease Vacancy
%
-
Total Vacancy
%
13.9%
16.9%
16.4%
Tenant
Submarket
Adddress
Size (sf))
GSA
Sony
Source Medical
Andrew Hill Investments
Embarq/CenturyLink
I-75/Colonial
Gateway
College
North Naples
North Naples
8860 Salrose Lane
12451 Gateway Blvd
12871 Univsersity Drive
4081 North Tamiami Trail
3530 Kraft Road
29,837
29,096
21,112
16,130
12,953
FORT WORTH, TX
MARKET OVERVIEW
The city/CBD market contains just over 9.5 million
square feet of office space and is currently showing a
vacancy rate of 13.1 percent, while the suburban
market contains over 33.5 million square feet and is
showing a vacancy rate of 16.6 percent. The Fort
Worth market brought on line almost 42,000 square
feet of new office space in 2011. There are no new
office developments happening in the Fort Worth
market.
The Fort Worth market continues to be at equilibrium.
Leasing activity should pick up in 2012, as tenants’
real estate needs become clearer. Landlords remain
aggressive in negotiations by offering concessions in
order to sign new tenants and to keep their existing
tenants. Rental rates are expected to stabilize in
2012. ■
Adddress
Size (sf))
Submarket
1 E Kirkwood Blvd
3 Campus Cir
8 Campus Cir
5 Campus Cir
801 Cherry St
381,376
120,243
101,516
100,738
45,910
Westlake/Grapevine
Westlake/Grapevine
Westlake/Grapevine
Westlake/Grapevine
CBD
14
Adddress
Size (sf))
Delivery Date
None
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
9,582,955
33,552,863
43,135,818
(49,472)
(251,314)
(300,786)
Direct Vacancy
%
12.8%
14.5%
14.1%
Sublease Vacancy
%
0.3%
2.1%
1.7%
Total Vacancy
%
13.1%
16.6%
15.8%
Tenant
Pier 1 Imports, Inc.
Mercedes-Benz Financial Services
Alcon Laboraties, Inc.
Practitioners Publishing Company
US Health Group
Submarket
Adddress
Size (sf))
West Southwest Ft Worth
Alliance
West Southwest Ft Worth
Ft Worth CBD
Ft Worth CBD
100 Energy Way
13650 Heritage Pkwy
7000 Calmont Ave
801 Cherry St
801 Cherry St
255,103
164,331
94,362
78,293
63,478
SWEARINGEN REALTY GROUP, LLC WWW.SWEARINGEN.COM
HAMPTON ROADS, VA
MARKET OVERVIEW
2011 began and ended with a positive net absorption
rates. A positive 117,950 square feet were leased in
the first quarter. The fourth quarter recorded only
11,800 square feet of positive net absorption but it
was very much welcomed after two quarters of
negative results, (196,135) square feet in the third
quarter and (133,774) square feet in the second
quarter. An increase in leasing activity with negative
net absorption suggests that many tenants downsized
their space requirements throughout the year.
The vacancy rate increased to 13.5 percent after the
delivery of five buildings that added 103,103 square
feet to the market’s inventory. Year-to-date deliveries
in eight new buildings totaled 255,878 square feet.
Four more buildings are under construction to bring
an additional 218,780 square feet. Rental rates also
increased slightly, however at $21.41 per square feet,
the averages are still over a dollar below the region’s
peak rents at the end of 2009. ■
Adddress
Size (sf))
Submarket
5701 Cleveland St
5800 Northampton Blvd
7023-7025 Harbour View Blvd
1313 Executive Blvd
1434 Crossways Blvd
90,000
72,167
59,226
26,417
21,800
Virginia Beach CBD
Airport/Northampton
Harbourview/N. Suffolk
Greenbrier
Greenbrier
15
Adddress
Size (sf))
Delivery Date
Interstate Professional Center
5424 Discovery Park Blvd
Towne Bank Operations Center
Geenbrier Medical Office II
Monarch Financial Center
66,000
40,000
39,399
27,476
17,301
2nd Quarter 2011
2nd Quarter 2011
4th Quarter 2011
1st Quarter 2011
1st Quarter 2011
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Totals
9,502,682
37,345,103
46,847,785
(117,615)
(82,544)
(200,159)
Direct Vacancy
%
14.5%
12.9%
13.2%
Sublease Vacancy
%
0.2%
0.3%
0.3%
Total Vacancy
%
14.7%
13.2%
13.5%
Tenant
Delta Education/H&B Architects & Engineers
SAIC
SDV Properties LLC
Amerigroup
Wells Fargo
Submarket
Adddress
Size (sf))
VA Beach CBD/Pembroke
Lynnhaven
York
Greenbrier
Downtown Norfolk
Town Center VAB
2877 Guardian Lane
133 Waller Mill Road
Liberty Two
The Wells Fargo Center
38,000
32,000
28,764
25,500
24,893
DIVARIS REAL ESTATE, INC. WWW.DIVARIS.COM
KANSAS CITY, MO
MARKET OVERVIEW
The Kansas City Metropolitan commercial real estate
market remains a tenant friendly environment. There
is very little new construction taking place. The largest
transactions in 2011 have been relocations in the
market with some signs that prospect activity is on
the upswing. One notable point is the recent drop in
the amount of sublease space on the market. With
little pressure from new construction, existing
properties should benefit from incremental increases
in leasing activity. The vacancy rates should decline
into and through 2012.
The agricultural, distribution and government services
sectors continue to spur whatever growth is alive and
well in the Kansas City metro area. The large
engineering and design firms in our market also are
improving. However, the Sprint Corporation continues
to make large blocks of space available on their 3.5
million square foot campus. ■
Adddress
Size (sf))
Submarket
1100 Main St.
11300 Corporate Ave.
9350 Metcalf Ave.
9300 Metcalf Ave.
4250 Main St.
240,947
170,000
150,899
78,376
75,974
CBD
College Blvd
Northeast Johnson County
Northeast Johnson County
Country Club Plaza
16
Adddress
Size (sf))
Delivery Date
Gibson Building
Park Place Nos. 1
21201 W. 152nd
66,000
59,000
51,000
March 2011
March 2012
June 2011
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
38,343,775
69,128,247
107,472,022
347,000
194,000
541,000
Direct Vacancy
%
13.5%
12.6%
12.9%
Sublease Vacancy
%
0.4%
0.3%
0.3%
Total Vacancy
%
13.9%
12.9%
13.3%
Tenant
EPA
Burns & McDonell Eng.
NAIC
Applebees
Encore Management
Submarket
Adddress
Size (sf))
South Johnson County
South KC
CBD
South KC
South Johnson County
Lenexa, Kansas
9201 Ward Parkway
Town Pavilion
8140 Ward Parkway
Linderwood Business Center
187,000
148,000
132,000
100,000
68,000
LASALA-SONNENBERG COMMERCIAL REALTY CO. WWW.LASALA-SONNENBERG.COM
LOS ANGELES, CA
MARKET OVERVIEW
The Los Angeles office market is beginning to see a
decrease in available space and an increase in
investment sales activity. Positive absorption continues
to improve, and with few deliveries in the pipeline to
apply upward pressure on vacancy, the market is
starting to stabilize. Lease rates are expected to
remain soft and concessions have begun to normalize.
As job creation continues and consumer confidence
stabilizes, the office rental market will continue its path
to recovery.
The U.S. economy plunged into a deep recession
combined with a severe financial crisis in 2008 and
2009. Throughout this period, employment declined
and jobless rates soared across the nation. The
economy reached bottom in June 2009, ending the
recession. However, Los Angeles County’s economy
experienced a gradual economic improvement in
2011 with the unemployment rate fluctuating and is
currently at 11.0 percent (October 2011) based on
the U.S. Bureau of Labor Statistics. ■
Adddress
Size (sf))
Submarket
2900 W. Alameda Ave.
9920 S. La Cienega Blvd.
633 W. 5th St.
555 W. 5th St.
12121 Bluff Creek Dr.
293,197
243,000
220,801
196,189
159,388
Burbank
LAX
Downtown LA
Downtown LA
Marina Del Rey/Venice
17
Adddress
Size (sf))
Delivery Date
275 Magnolia Ave.
750 San Vicente Blvd. West
750 San Vicente Blvd. East
545,000
211,426
203,568
August 2013
March 2012
March 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
66,856,184
305,755,396
372,611,580
(94,838)
375,292
280,454
Direct Vacancy
%
10.9%
13.2%
12.8%
Sublease Vacancy
%
0.5%
0.6%
0.6%
Total Vacancy
%
11.4%
13.7%
13.3%
Tenant
Direct TV
Bank of America
NBC Universal
Houlihan Lokey, Inc.
KCET-TV
Submarket
Adddress
Size (sf))
West LA
Downtown LA
Studio/Universal Cities
Century City
Burbank
2260 E. Imperial Highway
333 S. Hope St.
10 Universal City Plaza
10250 Constellation Blvd.
2900 W. Alameda Ave.
298,728
174,944
96,298
80,268
55,707
CHARLES DUNN COMPANY WWW.CHARLESDUNN.COM
MIAMI, FL
MARKET OVERVIEW
The last of the new buildings delivered on Brickell
Avenue, Brickell World Plaza, added 605,000 square
feet to inventory and increased vacancy to 23 percent
in this submarket. The pending completion of the
widening of the Panama Canal in early 2014 and the
related $2 billion of infrastructure improvements
currently underway at the Port of Miami should
produce positive benefits for the area, including
demand for office space.
Many of the South Florida submarkets in 2011
reported continued positive absorption that started in
2010. The vacancy rate for the South Florida Market
decreased to 14.5 percent, with net positive
absorption of nearly 850,000 square feet. Increased
leasing activity has led to stabilizing rates and reduced
concessions going into 2012. Confirming a
strengthening market was the recent sale of the
408,000 square foot Bank of America Tower at Las
Olas City Centre in Downtown Fort Lauderdale to JP
Morgan for $402 per square foot. ■
Adddress
Size (sf))
Submarket
600 Brickell Avenue
333 Avenue of the Americas
4700-4750 T Rex Avenue
1855 Griffin Road
2300 South Congress Avenue
484,023
391,900
300,000
200,000
208,609
Brickell
Downtown Miami
Boca Raton North
Fort Lauderdale
Delray Beach
18
Adddress
Size (sf))
Delivery Date
396 Alhambra, Coral Gables
21500 Biscayne, Aventura
170,185
116,645
1st Quarter 2012
3rd Quarter 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
41,693,739
181,329,990
223,023,729
690,943
1,218,571
1,909,514
Direct Vacancy
%
17.3%
13.5%
14.2%
Sublease Vacancy
%
0.5%
0.3%
0.3%
Total Vacancy
%
17.8%
13.8%
14.5%
Tenant
Crispin Porter & Bogusky, LLC
Gibraltar Private Bank & Trust Co.
University of Miami Bascom-Palmer
State Farm Mutual Automobile Insurance
Shoes for Crews, LLC
Submarket
Adddress
Size (sf))
Coconut Grove
Coral Gables
Plantation
NW Broward/Coral Springs
West Palm Beach
Mayfair in the Grove, East Bulding
Columbus Center
Crossroads 3
Convergys at Westpointe Centre
One Clearlake Centre
69,685
61,248
52,205
50,000
37,449
STILES REALTY WWW.STILES.COM
MILWAUKEE, WI
MARKET OVERVIEW
The Milwaukee office market improved slightly in the
third quarter of 2011, posting positive absorption of
27,000 square feet. Vacancy rates fell in the
downtown submarket but remained relatively
unchanged in the suburbs. The overall trend in both
the suburban and downtown markets has been
positive for the year, reflecting a stabilization of the
employment markets. As new development has been
stagnant for the past few years, we’re anticipating a
shortage of large blocks of space in some western
suburbs in the next few years, which will drive rental
rates closer to their pre-recession dollar amounts.
Adddress
Size (sf))
Submarket
11100 W. Liberty
310 W. Wisconsin Ave.
111 W. Wisconsin Ave.
10001 W. Innovation Dr.
10850 W. Park Place
80,000
59,206
47,745
45,000
41,222
Park Place/Milwaukee NW
Downtown West
CBD
Wauwatosa/Mayfair
Park Place/Milwaukee NW
19
The unemployment rate in Milwaukee is down a half
of a percent from a year ago, while the office sector
employment numbers showed a modest gain of
almost 1 percent from a year ago. We expect the slow
economic recovery to translate into positive absorption
over the next two to four quarters in the Milwaukee
Metro. ■
Adddress
Size (sf))
Delivery Date
NONE
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
Milwaukee
Waukesha
Total
20,745,986
6,692,453
27,438,439
201,831
(1,865)
199,966
Direct Vacancy
%
19.4%
20.5%
19.7%
Sublease Vacancy
%
0.8%
0.8%
0.8%
Total Vacancy
%
20.2%
21.3%
20.5%
Tenant
Kohl's
Gen-Probe
Wells Fargo
Annex Wealth Management
Joy Global
Submarket
Adddress
Size (sf))
Park Place
Waukesha/Pewaukee
CBD
Brookfield
Mayfair/Wauwatosa
7800 N. 113th St. in Milwaukee
Crossroads Corporate Center
100 East Wisconsin
12700 W. Bluemound,Brookfield
Honey Creek II
80,000
60,000
44,670
41,000
32,000
RFP COMMERCIAL, INC. WWW.RFPCOMMERCIAL.COM
NEW YORK, NY
MARKET OVERVIEW
The New York City office marketplace is comprised of
three the Manhattan markets of Midtown, Midtown
South and Downtown. Together they make up of over
450 million square feet, of which over 230 million
square feet is considered Class A. New York City is
host to a diverse group on industries and is home
many “Fortune 500” companies.
The New York City commercial real estate market was
the tale of two halves in 2011. The first two quarters
witnessed a robust marketplace while the second half
of the year was relatively quiet. The end result for the
year was overall strong with positive absorption of
approximately 2.1 million square feet in Manhattan
causing vacancy rates dip to 12.1 percent while
average asking rates increased to $50.17 per square
foot. The year was highlighted by a number of high
profile leasing transactions such as Conde Nast’s one
million square foot commitment at One World Trade
Center. ■
Adddress
Size (sf))
Submarket
85 Broad St
1 New York Plz
1221 Avenue of the Americas
11 Times Square
11 Times Square
651,513
551,825
536,617
353,551
279,866
Financial District
Financial District
Times Square
Times Square
Times Square
20
Adddress
Size (sf))
One World Trade Center
World Trade Center - Tower Four
World Trade Center - Tower Three
250 West 55th Street
International Gem Tower
Delivery Date
3,020,630
2,845,000
2,400,000
1,052,150
740,000
1st Quarter 2014
1st Quarter 2013
3rd Quarter 2015
1st Quarter 2014
4th Quarter 2012
Sublease Vacancy
%
2.4%
1.7%
1.6%
2.0%
Total Vacancy
%
11.8%
10.3%
16.3%
12.3%
Vacancy Rates
Location
Midtown
Midtown South
Downtown
Total
Size of Market (sf)
Net Absorption (sf)
212,000,000
140,000,000
98,000,000
450,000,000
950,000
2,859,000
(1,675,000)
2,134,000
Direct Vacancy
%
9.4%
8.6%
14.7%
10.3%
Tenant
National Broadcasting Company
The Conde Nast Publications
Nomura Secuirties International
Li & Fung
NYU Langone Medical Center and School of Medicine
Submarket
Adddress
Plaza District
World Trade Center
Times Square
Penn Plaza/Garment
Murrary Hill
30 Rockefeller Plaza
One World Trade Center
825 Eight Ave
350 Fifth Ave
1 Park Ave
Size (sf))
1,230,712
1,046,260
901,181
482,399
419,813
GEORGE COMFORT & SONS, INC. WWW.GCOMFORT.COM
NORTHERN NEW JERSEY
MARKET OVERVIEW
The Northern New Jersey Class A office market
experienced modest improvement in 2011 with
positive absorption of 1.1 million square feet. However,
the Class A improvement was fueled by a flight to
quality that came at the expense of the Class B & C
inventories, as these two classes posted significant
negative absorption numbers. The Class A vacancy
rate is 14.9 percent, with the average gross asking
rent rising slightly to $26.16 from $25.78 per square
foot gross. Speculative construction remains muted.
Leasing velocity was primarily dominated by renewal
transactions, but there were several very large lease
deals consummated as a result of corporate
consolidations. Lease deals remain heavy on free rent,
increased tenant improvement allowances and often
require base building improvements by landlords.
Landlords are valuing their tenant bases more than
ever, concentrating on delivering good management
services and with lots of communication. ■
Adddress
Size (sf))
Submarket
3000 Continental
1 Continental Dr
56 Livingston Av
300 Kimball
184 Liberty Corner
543,000
490,000
434,000
400,000
365,000
West Morris
Princeton North
Suburban Essex
Morris Cty
Route 78 East
21
Adddress
Size (sf))
Delivery Date
180 Park Av Florham Pk
175 Park Av Madison
325,000
275,000
3rd Qtr 2012
1st Qtr 2013
Vacancy Rates
Location
1,191,500
Direct Vacancy
%
14.9%
Sublease Vacancy
%
1.5%
1,191,500
14.9%
1.5%
Size of Market (sf)
Net Absorption (sf)
Northern NJ
147,556,295
Total
147,556,295
Total Vacancy
%
16.4%
16.4%
Tenant
Novo Nordisk
Realogy
Merrill Lynch
Gemini Technology
Atlantic Health Systems
Submarket
Adddress
Size (sf))
Princeton North
Morristown
Hudson Waterfront
Parsippany
Morristown
Ivy Crossing Princeton
175 Park Av, Madison
95 Greene Street, Jersey City
2 Gatehall
Southgate II
777,000
275,000
259,000
204,515
190,000
WEICHERT COMMERCIAL BROKERAGE WWW.WEICHERTCOMMERCIAL.COM
OKLAHOMA CITY, OK
MARKET OVERVIEW
Absorption of office space in Oklahoma City improved
dramatically in 2011, with substantial net gains
offsetting the minimal negative absorption from the
second half of 2010. Average asking rates remain
stable, and few large blocks of space are available.
Oklahoma’s economy is stronger than most of the rest
of the country and Oklahoma City continues to enjoy
broad support for its investments in urban
infrastructure, venues, and schools. This is evidenced
by the voters’ commitment to another penny sales tax
for MAPs III projects downtown, Devon’s progress with
its corporate headquarters, and Project 180’s
reconstruction of all the streets within the CBD.
During the next decade more than $3 billion of public
and private investments are committed to the
downtown area, an indication that the city’s
remarkable renaissance is likely to continue. ■
Adddress
Size (sf))
Submarket
211 N Robinson
7919 Mid America Blvd
3030 NW Expressway
4727 Gaillardia
106,397
34,814
26,794
25,071
Downtown
Southeast
Northwest
Downtown
22
Adddress
Size (sf))
Devon Tower - 325 W Sheridan Ave
6005 S Air Depot Blvd
Paycom - 7801 W Memorial Rd
Oklahoma Diagnostic Laboratory
Mustang Fuel
Delivery Date
1,800,000
June 2012
320,000 1st Quarter 2012
90,000
2012
70,000
2011
38,275
2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
5,657,716
9,018,174
14,675,890
8,296
314,107
322,403
Direct Vacancy
%
26.4%
13.1%
18.2%
Sublease Vacancy
%
0.1%
0.0%
0.0%
Total Vacancy
%
26.5%
13.1%
18.3%
Tenant
Submarket
Adddress
Size (sf))
Enogex
Chesapeake Energy
Vericrest Financial, Inc
OHCA
Midfirst
CBD
Northwest
Memorial
Midtown
Midtown
211 Robinson Ave
3817 NW Expressway
13801 Wireless Way
2402 NW 23rd
2401 NW 23rd
130,000
110,998
55,152
52,000
42,000
WIGGIN PROPERTIES, LLC WWW.WIGGINPROP.COM
ORANGE COUNTY, CA
MARKET OVERVIEW
The Orange County office market continues to show
signs of stabilization, with continued improvement in
vacancy and positive absorption during the end 2011.
For the upcoming year, job growth may stimulate new
office space demand; the decline in projected vacancy
will result primarily from minimal construction. Many
projects will remain in the planning process due to
limited construction financing. Reduced rents and
generous leasing incentives may encourage tenants
to consider larger and higher-quality spaces.
The recovery has been slow and steady over the past
12 months. With a net increase of 11,700 jobs from
August 2010 to August 2011, 5,600 jobs were
created in leisure and hospitality and 5,400 in
education and health services. Despite government,
defense, and aerospace cutbacks, other industry
sectors have been dampening the blow. ■
Adddress
Size (sf))
Submarket
18171 Von Karman Ave.
3800 Chapman Ave.
1100 Town & Country Rd.
7711 Center Ave.
2600 Michelson Dr.
140,000
82,752
80,969
80,000
60,075
Airport
Central
Central
West
Airport
23
Adddress
Size (sf))
Delivery Date
1003-1011 E. Ball Rd.
3400 E. La Palma Ave.
1041 E. Yorba Linda Blvd.
194,000
100,000
43,000
2nd Quarter 2011
3rd Quarter 2011
1st Quarter 2011
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
CBD
Suburban
Total
42,489,624
68,446,842
110,936,466
391,416
535,243
926,659
Direct Vacancy
%
17.0%
15.6%
16.1%
Sublease Vacancy
%
0.9%
0.8%
0.8%
Total Vacancy
%
17.9%
16.4%
17.0%
Tenant
CoreLogic
Microsemi Corporation
Western Digital
Experian
VPI Pet Insurance
Submarket
Adddress
Size (sf))
South
South
Airport
Airport
North
40 Pacifica
1 Enterprise
3337-3353 Michelson Dr.
535 Anton Blvd.
1800 E. Imperial Highway
169,287
109,948
104,000
87,000
77,828
PHOENIX, AZ
MARKET OVERVIEW
2011 was by no means a banner year for the Phoenix
office market. Rental rates continued to fall and the
improvement in vacancy is mainly due to a few larger
tenants taking occupancy of previously signed leases.
One thing is for certain: it was a better year than 2010.
The Phoenix market continues to lower the average
quoted rates and offer landlord concessions, allowing
new tenants to take advantage of market conditions.
Phoenix will remain a tenant’s market until the local
economy make significant strides for improvement.
The Phoenix area experienced a job growth totaling
27,100 jobs in 2011, representing 1.6 percent of the
total employment base. Nearly every employment
sector recorded job growth, including the construction
segment. From mid-2006 through mid-2010, the
sector lost 100,000 positions. In 2011, however,
employers created 2,200 construction jobs. Although
the Phoenix economy remains positive, forecasts
predict another slow year of growth in 2012. ■
Adddress
Size (sf))
Submarket
1500 N. Priest Drive
13610 N. Black Canyon Highway
1601 W. Fountainhead Parkway
16765 N. Perimeter Dr.
210 E. Earll Dr.
208,478
180,048
165,290
159,141
158,249
Tempe
North Phoenix
Tempe
North Scottsdale
Phoenix
24
Adddress
Size (sf))
Delivery Date
2700 West Frye Road
1601 West Fountainhead Parkway
183,000
165,290
1st Quarter 2011
2nd Quarter 2011
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
CBD
Suburban
Total
20,878,669
59,678,492
80,557,161
238,876
835,974
1,074,850
Direct Vacancy
%
21.8%
26.2%
25.1%
Sublease Vacancy
%
1.1%
1.1%
1.1%
Total Vacancy
%
22.9%
27.3%
26.2%
Tenant
US Foods
Fennemore Craig
Fender Musical Instruments Corp.
Greenberg Trauig, LLP
GE Capital Corp
Submarket
Adddress
Size (sf))
Chandler
East Phoenix
Scottsdale
East Phoenix
Tempe South
8075 S. River Parkway
2394 E. Camelback Rd.
17600 N. Perimeter Dr.
2375 E. Camelback Rd.
2150 S. 48th St.
132,224
121,000
119,681
78,286
68,224
PORTLAND, OR
MARKET OVERVIEW
The Portland metropolitan office market ended the
fourth quarter with net absorption totaling more than
283,000 square feet, marking the seventh quarter in
a row of positive absorption. The overall occupancy
level, currently 89.6 percent, has steadily increased
from low of 88.5 percent during the first quarter of
2010. Average quoted rental rates have increased
slightly over the last seven quarters, currently at
$19.83 per square foot (full service).
Tenants in the market today for CBD, class A office
space larger than 30,000 square feet have four
alternatives. Large blocks of contiguous office space
will continue to be limited until new office
developments are completed. Two proposed office
developments remain poised to move forward - One
Waterfront Place and Park Avenue West. Both projects
have significant pre-development work completed and
arebest prepared to deliver occupancy within 24
months. ■
Adddress
Size (sf))
Submarket
2035 NE Cornelius Rd - Bld B
Kruse Oaks III
Pacific Center
US Bancorp Tower
KOIN Center
116,500
108,454
67,272
38,702
29,181
SUB
SUB
CBD
CBD
CBD
25
Adddress
Size (sf))
Delivery Date
Park Avenue West
100 Multnomah
One Waterfront Place
480,000
337,000
250,000
2015
TBD
2014
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
CBD
Suburban
Total
11,751,987
15,871,793
27,623,780
191,044
216,717
407,761
Direct Vacancy
%
6.7%
13.5%
10.6%
Sublease Vacancy
%
0.7%
0.7%
0.7%
Total Vacancy
%
7.4%
14.2%
11.3%
Tenant
Miller Nash Law Firm
HDR Engineers
KPFF Engineers
RadiSys Corporation
Rockwell Collins
Submarket
Adddress
Size (sf))
CBD
CBD
CBD
Sunset Corridor
Wilsonville
US Bancorp Tower
Congress Center
US Bancorp Tower
5435 NE Dawson Creek Dr.
27500 SW Parkway Ave
56,379
48,111
47,788
45,655
34,180
MELVIN MARK BROKERAGE COMPANY WWW.MELVINMARKCOMPANIES.COM
RICHMOND, VA
MARKET OVERVIEW
As in 2010, the majority of activity in office leasing
occurred in the Innsbrook submarket in Northwest
Richmond. Reynolds Crossing III remains the only
building under construction and is expected to deliver
63,000 square feet in the second quarter of 2012.
Downtown Richmond and the Northwest quadrant saw
128,697 and 129,028 square feet of space absorbed
in 2011, respectively. New construction has not
weighed heavily on vacancy as of the top five new
deliveries are all 100 percent occupied.
Leasing and sales activity rebounded in 2011. After a
flat year, rental rates are expected to rise based on
the limited availability of Class A large blocks. Vacancy
rates have decreased as net absorption stayed
positive throughout the year. In the first nine months
of 2011, 13 sales transactions occurred with an
average price per square foot of $174.42--as
compared to $54.74 for the 7 transactions that were
recorded over the same amount of time in 2010. ■
Adddress
Size (sf))
Submarket
9954 Maryland Drive
11013 W. Broad St.
Rt 288 & Patterson
901 E. Byrd St.
919 E. Main St.
63,967
45,000
25,000
22,970
18,199
Innsbrook
Innsbrook
West Creek
CBD
CBD
26
Adddress
Size (sf))
Delivery Date
OrthoVirginia Building
VCHA & CCNV Headquarters
Mayland Medical Center - Bldg 1
Millworks V
Dominion Place - Building H
70,000
25,268
15,360
14,540
13,387
2nd Quarter 2011
1st Quarter 2011
2nd Quarter 2011
2nd Quarter 2011
3rd Quarter 2011
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Totals
18,129,268
42,065,726
60,194,994
135,529
353,346
488,875
Direct Vacancy
%
9.5%
11.3%
10.7%
Sublease Vacancy
%
0.7%
0.7%
0.7%
Total Vacancy
%
10.2%
12.0%
11.4%
Tenant
Mondial Assistance
Capital One Bank
SunTrust Bank
SnagAJob
Rummel Klepper & Kahl, LLP
Submarket
Adddress
Size (sf))
Innsbrook
Innsbrook
Innsbrook
Innsbrook
Shockoe Bottom
Deep Run 1/Mondial Assistance HQ
Liberty Plaza II
Franklin Commons
Rhodia Bldg
Edgeworth Bldg @ Tobacco Row
235,326
135,375
85,000
67,672
15,152
DIVARIS REAL ESTATE, INC. WWW.DIVARIS.COM
SAN ANTONIO, TX
MARKET OVERVIEW
In spite of activity sparked by the Eagle Ford Shale
play south of San Antonio, the year shows negative
absorption for 2011. The AT&T sublease space
returned to the market in fourth quarter. Many of the
large deals completed in 2011 were moves within the
market so they did not result in significant absorption.
NuStar and KCI are building new facilities that will
bring additional large blocks of space back to the
market in 2012.
San Antonio is Texas’ second largest city and
continues to be a friendly business environment with
logistic advantages favorable to businesses looking to
reduce operating costs or execute efficient expansion.
Positioned as a national economic leader, San Antonio
has gained several enviable spots on recent Forbes’
lists and most recently a spot on Bloomberg’s “One of
America’s top 50 best cities to live in” list. The Alamo
city is expected to continue to draw interest of new
businesses in 2012 and create additional job
opportunities. ■
Adddress
Size (sf))
Submarket
8023 Vantage Drive
1101 Sentry Gateway
7990 W IH-10
17802 IH-10
17806 IH-10
137,080
95,000
86,047
81,241
76,585
Northwest
Northwest
Northwest
Far Northwest
Far Northwest
27
Adddress
Size (sf))
Delivery Date
3503 Paesanos Parkway
1101 Sentry Gateway
17115 San Pedro Avenue
26,532
95,000
42,377
Feb-11
May-11
Dec-11
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
3,851,570
21,612,365
25,463,935
105,697
(247,430)
(141,733)
Direct Vacancy
%
27.7%
19.6%
20.8%
Sublease Vacancy
%
0.3%
0.5%
0.5%
Total Vacancy
%
28.0%
20.1%
21.3%
Tenant
Submarket
Adddress
Size (sf))
Visionary Properties, Inc.
The Hartford Financial Services Group
Texas A&M University System
Argo Group US
United Healthcare Services
CBD
Northwest
South
CBD
Northwest
175 E Houston Street
3600 Wiseman Boulevard
Brooks City Base
IBC Centre
Tech Ridge I
108,655
99,984
77,648
77,414
55,000
PELOTON COMMERCIAL REAL ESTATE WWW.PELOTONCRE.COM
SAN DIEGO, CA
MARKET OVERVIEW
The San Diego office market is progressively
improving as net absorption continues to maintain
positive gains while vacancy steadily decreases.
Positive net absorption of 700,373 square feet
dropped the direct vacancy rate for San Diego office
space to 16.6 percent at the end of 2011 from 17.1
percent in the third quarter. The San Diego office
market will continue to show modest improvement for
2012. Leasing activity will gain momentum once
occupational and economic conditions maintain
moderate improvement.
According to the State of California Employment
Development Department, San Diego County gained
13,500 payroll jobs from August 2010 to August
2011. The unemployment rate in San Diego County
was at 9.2 percent in November 2011, down from 9.7
percent in October 2011 and below the November
2010 rate of 10.6 percent. The decrease of the
unemployment rate may be an indication that the San
Diego job market will stabilize. ■
Adddress
Size (sf))
Submarket
1 Torrey Santa Fe Road
9885 Towne Centre Drive
12220 Scripps Summit Drive
401 West A Street
3570 Carmel Mountain Rd.
350,000
190,000
135,000
93,025
89,367
56 Corridor
Sorrento Mesa
East County
Downtown
Sorrento Valley
28
Adddress
Size (sf))
Delivery Date
16465 Via Esprillo
5454 El Cajon Blvd.
83,000
54,776
3rd Quarter 2011
2nd Quarter 2011
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
CBD
Suburban
Total
11,549,240
68,254,660
79,803,900
(10,103)
710,476
700,373
Direct Vacancy
%
17.9%
15.5%
15.8%
Sublease Vacancy
%
0.5%
0.8%
0.8%
Total Vacancy
%
18.4%
16.3%
16.6%
Tenant
Cooley Godward Kronish, LLP
Wells Fargo
Halozyme Therapeutics
Union Bank
AutoAnything
Submarket
Adddress
Size (sf))
UTC
Sorrento Mesa
Sorrento Valley
Mission Valley
Kearny Mesa
4401 Eastgate Mall
10421 Wateridge Circle
Sorrento Plaza
Rio San Diego Plaza
6602 Convoy Court
89,309
64,148
57,946
50,651
40,431
SAN FRANCISCO BAY AREA, CA
MARKET OVERVIEW
As predicted, the Bay Area office market made a
spectacular recovery in 2011. Gross leasing in Greater
Silicon Valley set a new record at 15 million square
feet. The explosive job growth of Facebook , Twitter,
and Salesforce led the way while mainstay Apple
grabbed as much space as possible in the West
Silicon Valley. Palo Alto Class A rents have hit common
highs of $96 while San Francisco’s South of Market
jumped to many mid to high $40 rents. Watch for a
burst of campus and speculative pre-entitled building
announcements in 2012.
The Bay Area's dominance as the top global region
for venture capital and innovation rang true in 2011.
Many submarket vacancy rates are below 5 percent
including Palo Alto, Mountain View and San
Francisco's infamous South of Market, at 3.3 percent.
There are no indications that this will slow in 2012.
Expect total Bay Area office vacancy rate below 10
percent by year end. As rental rates continue to climb
the pressure to deliver more space will mount. ■
Adddress
Size (sf))
Submarket
500 Terry Francois
55 22nd St
101 California
600 Montgomery
555 Mission
305,260
103,975
98,243
69,586
67,084
SF Mission Bay
SF South Financial
SF Financial
SF North Financial
SF South Financial
29
Adddress
Size (sf))
Delivery Date
SFPUC Headquarters
188 Spear St
257,097
73,631
2nd Quarter 2012
First Quarter 2012
Vacancy Rates
Location
San Francisco
East Bay/Oakland
South Bay/San Francisco
Total
Size of Market (sf)
Net Absorption (sf)
160,338,040
112,893,475
107,934,385
381,165,900
3,908,970
950,645
1,612,546
6,472,161
Direct Vacancy
%
10.5%
12.0%
12.2%
11.1%
Sublease Vacancy
%
1.0%
0.4%
1.0%
0.9%
Total Vacancy
%
11.5%
12.4%
13.2%
12.0%
Tenant
Facebook
Sony
Salesforce
Environmental Protection Agency
Twitter
Submarket
Adddress
Northern Silicon Valley
Mid Peninsula
SF South Financial District
SF South Financial District
SF SouthFinancial District
Network Circle, Menlo Park
Bridgepoint Park, San Mateo
50 Fremont St., SF
Hawthorne Plaza, SF
Market Square, SF
Size (sf))
1,000,122
450,501
412,000
259,152
214,950
RITCHIE COMMERCIAL, INC WWW.RITCHIECOMMERCIAL.COM
ST. LOUIS, MO
MARKET OVERVIEW
Overall vacancy rates in the St. Louis market rose by
10 basis points from 16.9 percent to 17.0 percent.
Space reductions from companies like Verizon, Sara
Lee, Monsanto and Wells Fargo have contributed to a
total 179,000 square feet of negative absorption in
2011. Given the continued decline in demand, rental
rates have fallen by 8 percent, averaging $19.25.
Average lease terms remain low, as companies delay
hiring due to economic uncertainty, and hesitate to
sign long-term leases.
Continuing on with the trends of 2011 – 2012 is
highly favorable to the tenant in search of great lease
terms and rates. Average lease terms/rates and
construction will remain low until we see an increase
in job growth in the area (which is projected to grow
by 2 percent this year). ■
Adddress
Size (sf))
Submarket
6 Cityplace Center Dr.
3470 Rider Trail S.
211 N. Broadway
800 Market St.
13640 Riverport
112,920
99,308
71,782
64,315
40,560
West County
Earth City
Downtown
Downtown
Earth City
30
Adddress
Size (sf))
Delivery Date
Streets of St. Charles
Sunnen Development
250,000
180,000
Phase 1 - 2nd Quarter 2012
Fall 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
12,253,179
38,736,658
50,989,837
(195,609)
16,859
(178,750)
Direct Vacancy
%
28.8%
12.1%
16.1%
Sublease Vacancy
%
0.5%
1.1%
1.0%
Total Vacancy
%
29.3%
13.1%
17.0%
Tenant
Stifel Financial Corp
BEB Management LLC
Peabody Energy
Clayton Bemiston Investors
St. Louis Metro Police Department
Submarket
CBD
CBD
CBD
Clayton
CBD
Adddress
501 N. Broadway
500 N. Broadway
701 Market
130 S. Bemiston Ave.
1901-1915 Olive Street
Size (sf))
434,000
285,211
215,362
156,932
143,024
COZAD COMMERCIAL REAL ESTATE, LTD WWW.COZADGROUP.COM
WASHINGTON, D.C.
MARKET OVERVIEW
The Washington, D.C. market continues to be one of
the top performing commercial real estate markets in
the United States as key market indicators, including
unemployment and office vacancy rates, outperform
all Metropolitan areas across the nation. Washington
DC remains the top recipient of federal procurement
dollars among all Metropolitan areas. This has led to
a consistently strong job market and economic
stability in the region.
Renewal activity dominates the market as the Federal
Government grapples with deficit reduction measures
and the private sector takes a “wait and see” approach
to their real estate. Submarkets offering mixed use
amenities and access to public transportation continue
to demonstrate solid fundamentals while outlying
suburbs suffered from a lack of tenant demand. ■
Adddress
Size (sf))
Submarket
1299 Pennsylvania Avenue
5001 Eisenhower Avenue
5275 Leesburg Pike
1015 Half Street SE
250 E Street SW
602,000
605,000
427,000
391,000
331,000
East End
I-395 Corridor
I-395 Corridor
Capitol Riverfront
Southwest
31
Adddress
Size (sf))
Delivery Date
800 & 810 10th Street, NW
165 N. Street NE
1000 Connecticut Ave, NW
800 N. Glebe Road, Ballston
500 N. Capitol Street, NW
462,228
400,000
394,145
300,575
211,818
3rd Quarter 2013
1st Quarter 2013
3rd Quarter 2012
3rd Quarter 2011
1st Quarter 2012
Vacancy Rates
Location
Size of Market (sf)
Net Absorption (sf)
City
Suburban
Total
113,488,741
212,043,531
325,459,013
2,156,845
(1,396,661)
760,184
Direct Vacancy
%
10.2%
14.5%
13.0%
Sublease Vacancy
%
0.8%
1.4%
1.2%
Total Vacancy
%
11.0%
15.9%
14.2%
Tenant
Submarket
Adddress
NOAA
Office of the Comptroller of the Currency
NASA
National Science Foundation
Federal Housing Finance Agency
Silver Spring
Southwest
Southwest
Ballston
Southwest
Silver Spring Metro Plaza
400 7th Street, S.W.
300 E Street, S.W.
4201 Wilson Boulevard
400 7th Street, S.W.
Size (sf))
1,000,000
702,000
597,000
541,000
351,000
AMR COMMERCIAL, LLC WWW.AMRCOMMERCIAL.COM
INDUSTRIAL SERVICES
The following CORE member firms service industrial clients in their respective markets:
Ackerman & Company
Atlanta, GA
Aronov Commercial
Montgomery, AL
Arthur J. Rogers
Chicago, IL
Cameron Butcher
Denver & Colorado Springs, CO
Charles Dunn Company
Los Angeles, CA
Cozad Commercial
St. Louis, MO
Divaris Real Estate
Hampton Roads, VA
LaSala-Sonnenberg
Kansas City, KS
LandQwest Commercial
Fort Myers, FL
Peloton Commercial Real Estate
San Antonio, TX
RFP Commercial
Milwaukee, WI
Stiles Realty
Fort Lauderdale, FL
Swearingen Realty Group
Dallas, TX
Weichart Commercial
New Jersey
Wiggin Properties
Oklahoma City, OK
Please visit www.corenetworkcre.org for contact information.
32
BOARD OF DIRECTORS
Christopher Cooper
Board of Directors - CORE Network
Chief Executive Officer
Charles Dunn Company
800 West Sixth Street, 5th Floor
Los Angeles, California 90017
p: 213 534 3201
ccooper@charlesdunn.com
Andrew J. Davidson
Chairman - CORE Network
Executive Vice President/Managing Director
MB Real Estate
181 West Madison Street, Suite 4700
Chicago, Illinois 60602
p: 312 558 3888
adavidson@mbres.com
Michael B. Divaris
Vice Chairman - CORE Network
President
Divaris Real Estate, Inc.
One Columbus Center, Suite 700
Virginia Beach, Virginia 23462
p: 757 497 2113
mdivaris@divaris.com
Bruce M. Hecht
Executive Vice President, Managing Principal
Swearingen Realty Group, LLC
5950 Berkshire Lane, Suite 700
Dallas, Texas 75225
p: 214 365 2700
bhecht@swearingen.com
Tom Kates
President
Stiles Realty
301 East Las Olas Boulevard
Fort Lauderdale, FL 33301
p: 954 627 9326
Tom.Kates@stiles.com
Rachel Krupnick
Executive Director
CORE Network
One Columbus Center, Suite 600
Virginia Beach, VA 23462
p: 757 490 7844
rkrupnick@corenetworkcre.org
M. James Mark
Chief Executive Officer
Melvin Mark Companies
111 Southwest Columbia, Suite 1380
Portland, Oregon 97201
p: 503 223 4777
jmark@melvinmark.com
William K. Montrose
Treasurer - CORE Network
Principal
AMR Commercial, LLC
7900 Wisconsin Avenue, Suite 202
Bethesda, Maryland 20814
p: 301 961 9696
wmontrose@amrcommercial.com
Jeanne Rogers, CCIM. SIOR
Executive Vice President/Principal
Arthur J. Rogers & Co.
1559 Elmhurst Road
Elk Grove Village, IL 60007
p: 847 297 2200
jrogers@arthurjrogers.com
F. Keene Miller
President, Brokerage
Ackerman & Co.
10 Glenlake Parkway, South Tower, Suite 1000
Atlanta, Georgia 30328
p: 770 913 3990
fkmiller@ackermanco.net
Gardner Peavy
Partner
Peloton Commercial Real Estate
4040 Broadway, Suite 520
San Antonio, TX 78209
p: 210 299 1172
gpeavy@peloton-sa.com
33

2011 National Market Overview

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