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Overbuilding Impacts Local Vacancy Rates

GREATER BOSTON-Preliminary third quarter figures released by Torto Wheaton Research indicate that this area's vacancy rates in office space are edging closer to the national average and an analyst with the firm blames the high volume of construction.

By Naomi Grossman | Updated on November 01, 2001

GREATER BOSTON-Local vacancy rates are getting closer to the national average, according to preliminary figures released by Torto Wheaton research, and that is largely due to a mini building-boom in the area, according to an analyst with the firm.

Preliminary numbers indicate that third quarter vacancy rates for 54 metropolitan statistical areas across the country are at 12.3%, up from 10.8% in the second quarter and 9.5% in the first quarter. For the MSA of Boston, third quarter vacancy rates are 12.1%, which is a little better than the national average but this area’s jump from the second quarter–which saw vacancy rates of 8.7%–was much higher. “Boston was performing better than the overall picture,” Xochitl Leon, an analyst in the strategic consulting group at Torto Wheaton Research, tells GlobeSt.com. “Now it is closer to the overall picture.”

Leon attributes this area’s jump in vacancy rates to the construction going on in the suburban markets. “There is a mini-building boom of sorts in the MetroWest market,” she points out. “It’s not as overbuilt as the last recession but there is still a lot of construction compared with the last five years.”

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