Source: REOC San Antonio / Xceligent
Demand for office space waned in the third quarter compared to activity recorded in the first half of the year. According to the survey of nearly 28.7 million square feet of office lease space, new leases and expansions inked in the third quarter were countered by tenant moves and consolidations which resulted in 7,480 square feet of negative net absorption.
At the close of the third quarter, the citywide vacancy rate stood at 17.8%, up slightly compared to 17.5% last quarter but improved compared to 18.8% recorded in the same quarter a year ago.
Vacancy within the subset of top-tier Class A properties now stands at 9.7% compared to 10.3% recorded a year ago. Even San Antonio’s challenged downtown market recorded a Class A vacancy rate of 7.5%.
Rental rates softened slightly in the third quarter. The average quoted full-service rental rate for area office space now stands at $19.57 per square foot per year on a full-service basis which is down $0.02 compared to the third quarter of 2013%. By comparison, the citywide average cost for renting Class A space currently stands at $25.29 – down $0.16 compared to a year ago.
Click to download REOC San Antonio’s 3Q 2014 Office Market Report.
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