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CBD Office Leasing Drops Off, Absorption Improves

PHILADELPHIA-Year-to-date office leasing activity in the CBD was approximately 50% below first-half 2002, according to Trammell Crow data. Net absorption for the first half dropped to negative 27,568 sf, down from more than a million sf in first-half 2002.

By Marita Thomas | Updated on August 11, 2003

PHILADELPHIA-”Limited signs of stabilization” occurred in the office CBD market during second-quarter, reports Bill Luff, SVP of the local office of Trammell Crow Co., “but the signals are still somewhat mixed throughout the classes that make up the entire CBD,” he adds. Year-to-date leasing activity fell to 890,510 sf, which is approximately half of the leasing activity during first-half 2002.

By contrast, however, year-to-date net absorption was negative 27,568 sf, “a great improvement from mid-year 2002, when the market was experiencing negative absorption of more one million sf,” Luff says. “This year’s absorption activity is the result of the physical move-in of last year’s leasing activity,” he points out.

The second-quarter overall vacancy dipped to 13.3% this year, down from 13.7% in last year’s second quarter. At the same time, the available sublet space in second quarter increased by 73,000 sf.

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