Local real estate watchers attribute the rising rates to a slowdown in the economy, layoffs at the banks and fewer expansions locally. Fourth quarter absorption was around 536,200 sf versus one million sf absorbed in the third quarter.
Net absorption during all of 2000 was 2.5 million sf, topping the 2.4 million recorded in 1999. A decline in construction activity, coupled with fewer expansions, should tighten the office market, the report states.
Charlotte brokerage firm Trinity Partners, which handles leasing at First Citizens Plaza, reports that up to three floors are being made available for sublease in the 451,000-sf building at 128 South Tryon St.
Sublease space is also available in Three First Union, South Tryon Square, Charlotte Plaza, the MassMutual Building, 212 South Tryon and 129 West Trade.
Setbacks in financial expectations at many technology companies have added significant sublease space to the market. For example, PSINet, an Internet services company, was planning to expand from 4,000 sf at Greylyn Business Park to 12,000 sf at Cambridge Partners' Ayrsley development on South Tryon Street. But the Washington-based company has closed up shop and will be leaving the Charlotte region.
Industry sources also point out troubled tech companies in the Triangle area. Level 8 Systems, a business software company, and Durham-based neoButler, an Internet software firm, are among those analyzing future growth plans. Level 8 is dropping about 15% of its 450-person work force to improve its share price and bottom line.
In a published report, Level 8 president/CEO Steven Dmiszewicki says the company, which has made four acquisitions in the past year and a half, decided to reduce its staff after a six-month study.
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