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Eastside Market Slowing, Heading Toward 'Normal'

BELLEVUE, WA-Still, with 3,244,465 sf of office space under construction, the G&E report speaks of a potential black cloud over the Eastside "...if the venture capital and stock markets continue to winnow away at the ranks of local high-tech firms.

By Janet Parker | Updated on January 24, 2001

BELLEVUE, WA-In September, the Federal Deposit Insurance Corp. issued a report warning of overbuilding here and elsewhere in the region, especially in the face of stock market volatility and slowing employment growth. The warning was much-ballyhooed according to local real estate folks who called the report overstated, outdated and narrow-minded. For example, they say it didn’t take into consideration all of the factors, such as the strong preleasing of projects then under construction.

Then, all of a sudden, high-tech and Internet companies began returning significant amounts of space to the market in the first half of October, and the real estate community acknowledged a slight slow down.

Now, according to the Space Markets Update released last week by researchers at Grubb & Ellis with their Q4 report, the Eastside market appears to be showing a few more signs of degradation, albeit minor. Craig Hill, SIOR and vice president of G&E’S Bellevue office, says while the market is slowing, it has been so hot that is it now just heading toward “normal,” which might equate to 5% vacancy rates by mid-year.

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