SEATTLE-Even with a glut of office space in the Puget Sound region, tenants renewing 10-year-old leases are expressing surprise at the going rate for their space in the new millennium. Arne Gillam, director of leasing for Unico Properties, recently signed five repeat tenants, and more than one showed symptoms of “sticker shock.”

“But that’s what happens when tenants sign 10-year agreements,” Gillam says. “Some of them have heard about the increases, but they had yet to deal with them. A few might mention some of the sublease space they have heard about, yet most see today’s rates as just the way things are.”

Unico Properties is a huge property owner in Downtown Seattle and throughout the Northwest. All told, the company’s portfolio includes more than seven million square feet of office and retail space. At One and Two Union Square in Downtown Portland, where Gillam resigned the tenants, the going rate for space is between $33 per sf and $42 per sf for One and between $37 per SF and $60 per sf in Two.

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