The report shows that the area's vacancy rate was a push this quarter at 13.79%, slightly up from 13.75% in the first quarter. In addition, Colliers reports that activity in the Seattle office market is picking up. Rates are still falling and tenants, who are faced with renewals on current leases, are hitting the market for better deals. Landlords are working with existing tenants to keep them and offering excellent deals to new tenants to attract them.

In the first half of 2002, no new buildings were completed. However, over the next nine months, new buildings will bring about 1.5 million sf of office space to the market... Of this new square footage only Hines' IDX Tower and Touchstone's Fifth & Bell Building have any significant preleasing, totaling 81% between the two. Colliers predicts slight increases in the vacancy rate when the new buildings hit the market, as the overall prelease rate is 66%.