The Seattle area has been reeling in sublease space for the past six months, sparking "when-will" wagers from calloused brokers who once made a healthy living on the dot-com companies blamed for the glut. Businesses, unable to sublease space or maintain profitability, are being forced to write expensive monthly checks to landlords for empty space.

"I don't know how you would judge that it's over, that the end is near,'' said Dan Dahl, office specialist in the Seattle branch of CB Richard Ellis. "I don't think we can expect to see a bloody hand on the sidewalk. I would guess, though, most of the big chunks of space are on the market. I don't see any other huge ones coming out of nowhere.''

According to the CBRE first quarter numbers, Average Class "A" asking lease rates continue to reflect a softening market and increases have slowed dramatically from previous quarters. Region-wide average asking lease rates increased to $31.71/sf from $31.08/sf. The only drop in rates was in downtown Seattle, where average rates fell from $39.09/sf to $37.37/sf, a casualty of the influx of new construction and sublease space available to tenants.

"We have about 1.85 million square feet of vacant space and a 6.2% vacancy rate,'' Dahl said. "I don't see that as cause for panic. We had been used to extreme absorption and not now things are really more normal.''

Some brokers point to the healthy preleasing activity of the over 3.2 million sf of new office space in the region, absorption was a surprising 1,922,785 sf of positive absorption. Surprisingly, the market showing the highest absorption totals was the Redmond office market in the middle of the high-tech corridor with over 800,000 square feet absorbed.

Undeterred by the current market conditions, some developers continue to plan, permit and build office projects at a remark-able rate, according to CBRE. Region-wide, there are over 6.9 million sf of office under construction, most of which is located in downtown Seattle and the Eastside. In downtown Seattle, two million square feet are under construction and nine million square feet are planned. Over 80% of the under-construction projects downtown are preleased.

While nobody has yet come forward to declare that the pendulum has begun to swing back up again, there are faint signs of some movement. Unfortunately, some of the movement is only lateral. And, who knows how many companies will walk away from prelease commitments. It's happened before.