Office Market Shrugs at Stock Market as Activity Remains Strong

BOSTON-Talk is starting to be heard of a slight economic downturn, and indeed last week’s stock market rumble rattled a few weaker spirits. Butthe Boston market is chugging along unaffected–so far at least.

Statistics newly released by Spaulding & Slye reveal a market that is solid and shows no sign of slowing. Looking at the greater Boston areaas a whole, S&S reveals that some 7.8 million sf of space was available in the quarter from a total inventory of 125.3 sf. Thatbrought the availability rate to 6.2%.

Year-to-date net absorption came in at 8.9 sf with absorption for the quarter posted at 4.2 million sf. Average asking rents hovered around $37.69 per sf.

Breaking the market down into subsectors, the winner in terms of Q3 availabilities was South Station, which logged 0.3% availabilities(6,070 sf). Bringing up the rear was Back Bay, which posted a 5% availability rate or 543,667 sf. Oddly, rents topped the charts at $56.39.

“Availabilities have gone down from last quarter’s 7%,” notes principal Tamie Thompson, “and vacancies at the time were at 3.3%. There’s more leasing occurring and more letters of intent out there. In the suburbsalone, demand still outweighs the supply, and even if the demand went away, we’d still have a very strong market.”

Helping that strength is the lack of spec construction, she tells GlobeSt.com. “It’s a very smart market,” she notes. “There are plenty of memories out there, and people are still reluctant. The market strategies are so much better thought-out.”