The numbers come from a survey conducted by Koontz McCombs Realty Services Inc., development, construction and brokerage company, based in San Antonio. Although the national and San Antonio economies has slowed all year, the third quarter treated the city roughly. Tenants gave up about 180,000 sf in the quarter, raising the year-to-date negative absorption to 255,000 sf. Much of that give back came from AT&T, which didn't renew 50,000 sf at the CityView Office Building, and SBC Communications Inc., which didn't renew 80,000 sf at Corporate Square Tower.

The aftermath of the Sept. 11 attacks exacerbated the market declines, low corporate earnings and layoffs. "The impact of these factors has been rippling through our market all year, giving businesses reason to pause and take a very conservative approach to their leasing or expansion plans," Todd McClain, senior vice president of Koontz McCombs, says in the report. "The result has been a stalled and slightly declining office market. Unfortunately, the tragic events of last month will only serve to deepen the market decline."

Rents still posted a small gain in the quarter, going to $17.75 per sf from $17.67 per sf at the end of the second quarter. In comparison, the close of the Q3 2000 was $17.41 per sf. The Koontz McCombs report says rental concessions are beginning to pop up as small amounts of free rent.