ST. LOUIS—The office market in this region had a historic year in 2014, according to a new DTZ report, netting 474,000 square feet of positive absorption in the fourth quarter, bringing its year-end total to 680,000 square feet, and the second quarter of 2015 also turned out quite robust.

“For the third consecutive year, St. Louis posted over 265,000 square feet of absorption in the second quarter,” the company found. Furthermore, the rest of the year is also looking good. “A flurry of large deals will hit in the third and fourth quarters further compressing vacancy rates.” Among the big upcoming deals are Boeing's leases of 47,000 square feet at St. Louis Community College's Corporate College building in suburban Bridgeton and 37,000 square feet at 13900 Riverport Dr. in suburban Maryland Heights.

As usual, the west suburban markets performed particularly well. West County was the best performing submarket this quarter, posting 118,000 square feet of absorption, DTZ found. The big lease for this submarket was Edgewell Personal Care, which moved into 44,000 square feet at Timberlake Corporate Center III in Chesterfield. “West County is expected to experience even stronger demand in the third and fourth quarter as it contains three of the four largest blocks of available class A space,” DTZ found.

Suburban Clayton just west of the city is perhaps the strongest submarket in the region, and its class A vacancy rate  at the end of the second quarter was just 7.4%, the lowest level since 2008, according to DTZ. Things in the town have gotten so tight that it does not have any class A or B buildings with over 30,000 square feet of contiguous space. But even though this lack of large contiguous blocks has inhibited absorption, landlords have still been able to increase rental rates. The average asking rate for class A space has risen by $0.89 per square foot in the last twelve months. “Asking rents for office space in Clayton, Creve Coeur and Chesterfield, for example, hit historic highs, and tenants have found it more difficult to rent large blocks of contiguous space.”

And although the suburban markets have fared well, the downtown class A market also had a strong second quarter with 67,000 square feet of positive absorption. Many observers hope that 2015 becomes a true turnaround year for the region's CBD. As reported in GlobeSt.com, a public-private partnership will soon complete a $380 million renovation of downtown's Gateway Arch. The project, called CityArchRiver 2015, will for the first time connect the CBD to the riverfront and the park surrounding the Arch with one continuous greenway.