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Heimsath: Office Occupancy Plummets to 84.9%

AUSTIN-It won't be a replay of the late 1980s, but Austin's office occupancy is caught in an undertow of a falling economy. Charles Heimsath of Capitol Market Research pegs the overall rate at 84.9%, down from 95% in December.

By Tim Green | Updated on July 12, 2001

AUSTIN-Charles Heimsath calls it a “precipitous” drop, then adds it probably will get worse before it gets better. He is, of course, referring to the Austin office market, in which occupancy rates and rents are falling. Heimsath, who’s tracked the market since the 1980s, tells GlobeSt.com that it won’t get as bad as the late 1980s when the occupancy rate hit 60% and many buildings seemed to have the same name: “For Lease.”

In his mid-year Austin Area Office Market Survey, Heimsath, founder and president of Capitol Market Research Inc., pegs the overall office occupancy rate at 84.9% at the end of June, off from 95% in December. The 85% includes the occupancy from direct leases and subleases. By itself, the direct lease occupancy is 92.4%, down from 95.5% in December.

Heimsath’s is one of several reports that will assess the Austin real estate market at mid-2001. NAI/Commercial Industrial Properties is due to release its report soon and Angelou Economic Advisors will issue a revised forecast July 25.

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