"Tenants will have the strongest bargaining leverage since the early 1990s," says Keith Mackenzie, Senior Vice President and Managing Director, for the Oakland office of Grubb & Ellis. "We expect that tenants will enjoy a negotiating advantage through much of next year due to a weak leasing environment coupled with continuing deliveries of buildings still in the construction pipeline."
Grubb & Ellis, a commercial and corporate real estate services provider, reveals that vacancy in the East Bay marketplace is averaging 8%, although there is significant deviation when comparing the I-680 corridor to the I-80/880 corridor.
Mackenzie says the I-80/880 corridor's vacancy rate is currently 10.6%, with some key sub-markets hitting 17%. The I-680 corridor's vacancy rate is averaging 6%, presently the lowest vacancy area in the Bay Area.
Mackenzie remains hopeful for the Bay Area, despite the numbers. "While the East Bay vacancy rates are expected to increase in the short term, as more space returns to the market, the rate of increase should slow and level off in 2002. A key factor in the lower vacancy of the East Bay, as compared to other parts of the Bay Area, is the strong diversity of the market and lower costs for housing," he says.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
