July 19, 2019
According to DFW metrics released by various commercial real estate companies, Q2 2019 had positive job numbers, leading to positive office absorption, lower vacancies and an increase in the average asking rent rates.
What was interesting to note was that Class A office space reported positive absorption in the second quarter, with “Class B and Class C buildings having a negative showing,” according to CBRE. Cushman & Wakefield dubbed the trend “a strong flight to quality,” noting that tenants will continue moving out of older Class B and C buildings as newer ones come online. Younger Partners forecast a continued decline in occupancy rates, though acknowledged that there remains “large blocks of second-generation spaces that need to be backfilled . . . ”
Differences in statistics is based on methodology. Younger Partners’ numbers come from CoStar’s database, and includes office buildings containing at least 15,000 square feet and owner-occupied facilities. CBRE metrics includes buildings measuring at least 30,000 square feed, excluding owner-occupied properties.
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