Last year, there was 11.6% of vacant space, and rental rates stood at approximately $3 per foot in the downtown area. In 2000, vacancy rates were less than 4%, and the average rental rate was $4 per sf. BT Commercial's third quarter report reveals that vacancies have significantly increased and rents have declined during each of the last 10 quarters. The average rental rate in downtown Oakland is now about $2 per sf.
The third quarter also showed that, for the first time this year, businesses actually rented more space than they got rid of. BT Commercial attributes this to the arrival of new construction on the market.
However, new construction seems to be a thing of the past, as many Oakland office projects are being canceled or delayed because it is becoming increasingly difficult and costly to open new developments in the area when there are no tenants to fill them.
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