Nationally, the Philly CBD "continues to fare well and better than most,"the researchers say, noting the office vacancy rate here ranks fifth lowestamong 31 CBDs studied by C&W. A company spokesperson tells GlobeSt.com thatWashington, DC tops the ranking at 7.9%, followed by Brooklyn, NY, 10.9%;Midtown, NY, 12%, and Downtown, NY, 12.6%.
Office leasing activity here was down 45,295 sf in second-quarter, comparedwith the year's opening quarter. However, year-to-date, it totaled 661,371sf, which is an increase of 40% over mid-year 2002.
Asking rents in the CBD remained flat for the past year and a half.According to the report, the average for direct space in a class-A property east ofBroad Street is $23.24 per sf, while it is $27.12 per sf for comparableproperties west of Broad. Owners are reportedly offering aggressive deals,however, including free rent and large tenant improvements for credit-worthy tenants.
"The rental rate spread between the trophy buildings and older class-Aproduct is at historic lows," according to C&W, "prompting tenants to seizethe opportunity to upgrade their space."
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