Search
 

Suburban Office Market Tilts Toward Owners

PHILADELPHIA-A strengthening of the suburban office sector begins to deplete class A properties. As the tenant base expands, once-languishing submarkets gain steam.

By Marita Thomas | Updated on January 29, 2007

PHILADELPHIA-Like the CBD, virtually all of the suburban office markets have experienced absorption, declining vacancy and rising rents in the past year, according to reports from area brokerage companies. The upward trend is expected to continue.

Characterizing the overall suburban office market as “very strong,” Dan Dagit, senior vice president in the Wayne office of CB Richard Ellis, tells GlobeSt.com, “vacancy is falling to 15%, fueled primarily by expansion of the existing tenant base. The markets are in recovery. While it’s still a tenants’ market,” he says, “the tipping point will occur this time next year.” Fort Washington, a once-languishing submarket, was among the most active in 2006, he says and credits much of its success to a 450,000-sf lease by Horsham-based ResCap, GMAC Mortgage Corp.’s residential real estate lender.

Eight of the 11 suburban submarkets tracked by Wayne-based GVA Smith Mack recorded absorption in the final quarter of 2006, according to Tim Pulte, the firm’s executive managing director. “Increased stabilization along with increased rents has strengthened the position of landlords,” he says.

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.