Colliers International's first-quarter vacancy rate survey shows a figure of 7.8% for Downtown, more than double the 3.5% recorded at the end of 2000. "We are looking at a grossly exaggerated market," says Colliers' Jeanette Ferguson. "A year ago, we saw volatile high-tech companies attacking the market, and now that's no longer the case. I don't think we'll see an evening out before the third or fourth quarter of this year."

The amount of sublease space also has nearly doubled since the final quarter of 2000, according to Grubb & Ellis. The company put the sublease level at 1.1 million sf, up from 621,000 sf at the end of last year.

The "Boeing Perception," the idea the Puget Sound region is no longer as attractive given the aircraft giant's decision to move its world headquarters, has not been a factor Downtown, according to Ferguson. "The Boeing move may make people look a little harder," Ferguson says, "but I don't think it has distracted them from coming. We have the larger import-export picture going for us--a closer gateway to Asia than just about anywhere else."

Dan Dahl, Downtown office specialist for CB Richard Ellis, said the high-tech demands of 1999 and 2000 have given way to a more traditional market. "The absorption in those years was about three million feet each year, and historically it's been about 1.3 million," Dahl says. "High-tech was responsible for about 80% of that and our 1.5% vacancy rate was not very healthy. Now, at about 6%, it gives tenants a few choices."

Dahl said the glut in vacancies is in the class C space while trophy class A high rises still showed 2%-3% vacancies. Cushman & Wakefield estimates the average overall rent for class A office space Downtown was $36.90 per sf in the first quarter, down slightly from $37.02 per sf in the October-December 2000 period. The range for the first three months of this year was $25 per sf to $60 per sf per year, according to Cushman & Wakefield.

"A lot of the high-tech companies were in the class C space because they wanted to show their funders they were on the cheap," Dahl said. "When they didn't get their second or third round of funding, they dried up and blew away. That's fine. More traditional companies have come back in--law firms, title companies, engineers. . ."