July 6th, 2011, By Dana Haugh
In light of the recent turnaround in the commercial real-estate sector, the market has, so far, shown an increase in the amount of occupied office space in the first and second quarters of 2011. The first quarter showed an increase of 5.5 million square feet of inhabited office space, while the second measured a close 3.7 million square feet. The decrease, though slight, might be a factor of the minor “stumbles” the economy took in the recent months, but the reduction is nothing to raise eyebrows about. This recent increase in office tenants comes after a lengthy dry spell in which a total of 138 million square feet was emptied over a period of 2 years. Although 11.9 million square feet (totaled since October 2010) is small in comparison to the hundred million available, it’s still a step in the right direction (if only a baby step). A slow, consistent progress has made its presence known in the tenant market, and even a small improvement is something to celebrate.
The increased tenancy is thought to be a direct result of the impact of more resilient areas such as New York and Washington, who are (apparently) leading
the pack in job growth. In May, the Bureau of Labor Statistics estimated that the economy added just 54,000 new jobs and they expect June’s totals to be slightly higher, but of course critics chastise the slow moving pace of recovery. However, rents did have a minimal increase (.2%), which is starkly conducive to an improvement in the office and tenant area of the market.
And on top of that, new office construction has begun to take hold, noticeably in Washington DC and New York.
Keep Calm and Carry On, America.
All information gathered from The Wall Street Journal
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