SOURCE: Cushman & Wakefield | Commerce
SEATTLE, WA--(Marketwired - Feb 6, 2014) - Commercial real estate in the Seattle-Tacoma-Bellevue Metro area had a strong Q4 in 2013 according to new data by the Seattle and Bellevue branches of Cushman & Wakefield | Commerce. The firm released its most recent Marketbeat Snapshot reports detailing the state of commercial real estate in the Seattle and Bellevue markets.
Unemployment is down to six percent in the Puget Sound area and it continued to be a hot bed for tech jobs; Forbes reported a 45.5 percent increase in tech jobs since 2001 and a 19.5 percent increase in STEM (Science, Technology, Engineering and Mathematics) over the same period.
"In 2013, the Seattle-Tacoma-Bellevue markets continued to perform better than the overall U.S. economy -- this is reflected in the fact that office vacancy rates for the Seattle central business district dropped by 3.2 pps to end at 12.8 percent," said Dave Magee, Cushman & Wakefield | Commerce Senior Director and Managing Broker of the Washington Region. "With low construction activity in the area, the market will likely continue to absorb existing space, which will lower vacancy and put upward pressure on rental rates."
Seattle CBD Office Snapshot
The CBD for Seattle recovered strongly through 2013 as the overall vacancy rate dropped by 3.7 pp to end at 12.8 percent. Both Pioneer Square/International District and Lower Queen Anne/Lake Union are seeing single digits at 9.2 percent and 8.9 percent, respectively. The area benefited from Amazon's ongoing expansion and additional construction will likely result from this tightening. Average direct asking rents made a strong recovery with a 4.4 percent increase on a year-over-year basis.
Seattle Suburban (Southend) Office Snapshot
Vacancy rates for the Southend office market ticked up slightly by 0.6 pp to end the year at 20.5 percent. This small movement upward, while sluggish, shows a level of stability in the market. And despite slightly higher vacancy rates, average asking lease rates increased by 8.2 percent on a year-over-year basis.
Seattle Industrial Snapshot
Even with 1.6 million square feet of new construction during 2013, the overall vacancy rate continued to push downward registering a 0.8 pp drop from 2012 to end the year at 6.6 percent. Despite the declining vacancy rate, average asking rental rates also declined by 4.4 percent. Port activity was mixed for the Puget Sound area including the Port of Tacoma and the Port of Seattle is down slightly by 3.6 percent on a year-over-year basis.
Bellevue Office Snapshot
Job growth in the Bellevue area was strong throughout the year. This supported solid vacancy rates and landlords were able to push average asking lease rates, which increased by 5.9 percent on a year-over-year basis. The Bellevue CBD has one of the lowest direct vacancy rates in the Puget Sound area at just 8.9 percent. This low rate is putting pressure on developers to add buildings to the market. The area can expect continued high demand for the next two years, and rental rates are expected to increase at a brisk pace.
Bellevue Industrial Snapshot
On the Eastside/Northend, markets improved slightly on a year-over-year basis as the overall vacancy rate dipped by a 0.4 pp; however, despite this improvement, in Q4, the vacancy rate increased slightly as leasing activity slowed significantly.
The full reports for each of these markets, as well as historical reports are available for download at: http://www.comre.com/research.cfm
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About Cushman & Wakefield |Commerce
Cushman & Wakefield |Commerce, an independently owned and operated member of the Cushman & Wakefield Alliance, has been the leading provider of real estate brokerage services for more than 30 years. Headquartered in Salt Lake City, the firm has offices throughout Utah, Nevada, Idaho and Washington. It offers consulting, brokerage, tenant and landlord representation, property and facilities management, and valuation services to corporations, institutions and investors throughout the Intermountain West and Pacific Northwest. For more information, and for property listings, broker information, market category reports and more visit www.comre.com.
About Cushman & Wakefield
Cushman & Wakefield is the world's largest privately‐held commercial real estate services firm. The company advises and represents clients on all aspects of property occupancy and investment, and has established a preeminent position in the world's major markets, as evidenced by its frequent involvement in many of the most significant property leases, sales and assignments. Founded in 1917 it has 243 offices in 60 countries and more than 14,000 employees. It offers a complete range of services for all property types, including leasing, sales and acquisitions, equity, debt and structured finance, corporate finance and investment banking, corporate services, property management, facilities management, project management, consulting and appraisal. The firm has more than $4 billion in assets under management through its wholly‐owned subsidiary Cushman & Wakefield Investors. A recognized leader in local and global real estate research, the firm publishes its market information and studies online at www.cushmanwakefield.com/knowledge.