BOSTON-A slight uptick in the vacancy rate during the first quarter doesn't negate an otherwise positive story in the Greater Boston office sector, services firm Richards Barry Joyce & Partners says in its quarterly research report, “officeSTATus – Spring 2013.” For one thing, 42% more buildings across the region gained occupancy than lost it during Q1, according to RBJ.
“Greater Boston's office market remains in a great position,” said Brendan Carroll, SVP of research at RBJ, says in a release. “The market has charted a solid course since mid-2011 that creates a sense of optimism for the remainder of the year. “
A shadow across the quarter was cast in the form of a number of one-time consolidations that resulted in the Greater Boston vacancy rate ticking up one percentage point to 14.5%. In terms of square footage, that uptick represents just 105,000 square feet.
A longer-term story is the concentration of availability in a handful of locations in some of the region's hottest submarkets, which have accounted for much of the positive absorption seen in the past few years. “Having boasted little availability for many consecutive quarters, Back Bay and East Cambridge have been joined by the Seaport District, Framingham and Waltham, where sustained recent demand trends have materially shifted the demand/supply balance,” according to RBJs report. “Availability figures for the Back Bay, East Cambridge and the Seaport District tend to overstate the ease of finding options for tenants; much of the available space in these markets is concentrated in a few distinct properties, offering tenants few distinct choices.”
Some relief may be in the offing thanks to new construction, although much of that is already spoken for, RBJ says. What the firm calls “a ravenous tenant appetite” for new product means that the current pipeline is 2.6 million square feet, half of which will deliver in 2013, is already 95% leased. “These facilities will join the five million square feet that have already been delivered this decade and are 95.2% leased,” according to the report.
“These resounding numbers combined with tenant enthusiasm over certain areas is strength
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