Search
 

Sublease and Construction Slowdowns Keep Suburbs in Check

PHILADELPHIA-The suburban office vacancy rate seems to have stabilized at

By Marita Thomas | Updated on February 06, 2003

PHILADELPHIA-The western Philadelphia suburbs finished 2002 with approximately 55,000 sf of positive absorption, suggesting “that the trough of the real estate cycle has been reached,” says Matthew Guerrieri, senior research manager of the local office of Grubb & Ellis. The suburban office vacancy rate of 18.4% remained virtually unchanged.

Guerrieri attributes both conditions to a slowdown in construction completions and a significant slowdown in the amount of sublease space coming on stream. During 4th quarter, slightly less than 100,000 sf of sublease space was added to the market, he reports, compared with the previous four quarters, each of which added, on average, 300,000 sf of sublease space. “Construction dwindled from its peak, only one year ago, by more than 50%,” he adds.

Asking rental rates remained steady throughout 2002. The average asking rental rate for class A and class B suburban office properties is $27.75 per sf and $22.19 per sf, respectively.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 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.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.