The Cambridge office-lab market is still very tight, despite a 0.9% increase in the vacancy rate to 3.8%. The region saw 104,000 square feet of negative absorption, mostly emanating from Mid-Cambridge which saw 98,000 square feet of negative absorption in the last three months of 2016, according to Transwestern. Average asking lease rates in Cambridge reached $65.62-per-square-foot this quarter, up $1.11- per-square-foot over last quarter, and up 10.1% from two years ago. East Cambridge led the region in average asking lease rate at $76.93-per-square-foot at the end of the fourth quarter 2016.

The Route 128 market collectively registered 433,000 square feet of positive absorption, the highest level recorded for the region. The strong fourth quarter activity fueled a 0.5% decline in its vacancy rate to 12.9%. The Route 128 North region led the way with 331,000 square feet absorbed, which broke a string of three consecutive quarters of negative office space absorption.

Other key takeaways from the Transwestern fourth quarter 2016 office report include:

• Average asking rents in Boston rose to $55.09-per-square-foot.

• In the entire 1.5-million-square-foot South Station office market, there is only 65,000 square feet of vacant space, all of which is Class B space.

• In the last two years, the vacancy rate in East Cambridge has fallen 4.1 percentage points to 3.0%, the lowest rate on record for the area.

• Availability for Class B space in Boston reached the lowest rate since 2008 at 13.1%, with asking lease rates increasing 10.5% in 2016 to $41.31-per-square-foot.

• The I-495 submarkets rebounded after a negative third quarter, with 115,000 square feet of positive absorption and its office vacancy down 0.7 percentage points to 21.7%.

• Average asking lease rates along I-495 closed at the end of the fourth quarter virtually unchanged at $21.43-per-square-foot.

BOSTON—The office market in Greater Boston continued its nearly four-year bullish run at year's-end 2016 with positive absorption and strong tenant demand, positioning it as a top market once again for investors in 2017.

Commercial brokerage firm Transwestern reports that in the past 15 quarters the Greater Boston office market has absorbed 12 million square feet of space. In the fourth quarter of 2016, the market enjoyed 789,000 square feet of positive absorption, including 59,000 square feet from the Boston CBD, which resulted in the vacancy rate declining slightly there to 9.6%. For all of 2016, there has been 1.4 million square feet of office space absorbed in Greater Boston. The vacancy rate for Greater Boston declined slightly to 12.7% by year's-end 2016.

“The Greater Boston market is on a prolonged period of positive results, with 14 of the past 15 quarters delivering positive absorption,” says Chase Bourdelaise, Northeast director of research for Transwestern. “Additionally, the market is very well positioned heading into 2017, with a number of high-profile moves on the horizon and more than 2 million square feet expected to deliver during the year. Additionally, we expect Boston's commercial office market to remain a top destination for investment dollars.”

The Financial District saw the most action in terms of positive absorption in the fourth quarter at 69,000 square feet, thus lowering its overall vacancy rate to 9.7%. Class A space in the Financial District, which is in high demand, saw 237,000 square feet of positive absorption in the fourth quarter.

The Cambridge office-lab market is still very tight, despite a 0.9% increase in the vacancy rate to 3.8%. The region saw 104,000 square feet of negative absorption, mostly emanating from Mid-Cambridge which saw 98,000 square feet of negative absorption in the last three months of 2016, according to Transwestern. Average asking lease rates in Cambridge reached $65.62-per-square-foot this quarter, up $1.11- per-square-foot over last quarter, and up 10.1% from two years ago. East Cambridge led the region in average asking lease rate at $76.93-per-square-foot at the end of the fourth quarter 2016.

The Route 128 market collectively registered 433,000 square feet of positive absorption, the highest level recorded for the region. The strong fourth quarter activity fueled a 0.5% decline in its vacancy rate to 12.9%. The Route 128 North region led the way with 331,000 square feet absorbed, which broke a string of three consecutive quarters of negative office space absorption.

Other key takeaways from the Transwestern fourth quarter 2016 office report include:

• Average asking rents in Boston rose to $55.09-per-square-foot.

• In the entire 1.5-million-square-foot South Station office market, there is only 65,000 square feet of vacant space, all of which is Class B space.

• In the last two years, the vacancy rate in East Cambridge has fallen 4.1 percentage points to 3.0%, the lowest rate on record for the area.

• Availability for Class B space in Boston reached the lowest rate since 2008 at 13.1%, with asking lease rates increasing 10.5% in 2016 to $41.31-per-square-foot.

• The I-495 submarkets rebounded after a negative third quarter, with 115,000 square feet of positive absorption and its office vacancy down 0.7 percentage points to 21.7%.

• Average asking lease rates along I-495 closed at the end of the fourth quarter virtually unchanged at $21.43-per-square-foot.