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OFFICE SPACE LOSSES throughout the region lessened this quarter by 60 percent against an average quarterly loss of 216,000 sf Oter the previous four quarters.
Is this a trend? Not yet. Though it’s a good step in the right direction, a loss is still a loss. Only Pinellas reported an ever so slight gain for this period. Correspondingly, the asking rental rates are becoming more realistic.
Hillsborough continued to record the region’s greatest quarterly
loss. But it is the smallest loss in six quarters, and it is an improvement
by nearly three-fourths against an average loss of 180,000
sf the previous four periods. Of all the region’s submarkets, Hillsborough’s
I-75 Corridor performed the
best this period with an 80,700 sf gain,
and is ranked right at the top for its net
gain over the past 12 months. Sabal Park got a big boost with Eola
Capital’s lease to Nova Southeastern University. Without that, the
I-75 market would have been a wash. Construction was completed
on Angelica Place adding 46,000 sf to the stock of vacant space.
Westshore still is in the loss column but much less so than the
previous two quarters. The opening of building four at International
Plaza Corporate Center contributed a healthy plus, but move-outs
elsewhere in the submarket overshadowed the gain.
Pinellas was the only county to squeak out a gain for the quarter,
but at 7,140 sf it was nothing to write home about. North Pinellas
recorded decent leasing, pushing its annual rate back to the plus
side for the first time in six quarters. But Bayside wiped out any of
the county’s gains with its eighth consecutive quarterly loss. Downtown
St. Petersburg continues to show the county’s strongest volume
over 12 months. Rents slipped in all five Pinellas sub-markets.
Downtown Sarasota’s occupancy dropped for the third straight
quarter. This market has experienced losses in nine of the last 12
quarters. Rents here dropped a substantial $.47 per sf this period
and are off $2.29 per sf from a year ago. Activity in Sarasota’s
other two submarkets – I-75 and Suburban/Venice – offset downtown’s
loss so the county’s overall activity was a wash. The county
still has the region’s lowest vacancy rate, by nearly four points.
Manatee seesawed back into a loss position this period. Construction
is now complete on two buildings at Cooper Creek, both
vacant. The new, more expensive space helped nudge the average
rental rates up by $.26 per sf.
Though Pasco experienced its first loss in 10 quarters, it remains
the only county with a gain over 12 months. Rents moved up by $.15
per sf. The vacancy rate, once again topped 30 percent, exceeding
the region’s next highest rate – in Pinellas – by five points.
Polk’s activity was barely a blip, but the annual deficit grew by
more than one-fourth.
The stock of space available for sub-lease around the region
dropped substantially this quarter. Some of it was leased; much
of it expired, contributing to the poor numbers in overall activity.
Space reported as coming available in the coming months also
dropped this quarter – a positive sign that the pipeline isn’t continuing
to grow.
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