SEATTLE-Seattle’s ultra-tight office market, now hovering at around a 1% vacancy rate, has sent lease rates in some new class A office buildings soaring past the $50 per sf full-service benchmark, according to a third quarter report released yesterday by Grubb & Ellis.

The report notes that rental rates in at least two Downtown Seattle buildings, Two Union Square and Bank of America Tower, are now topping $50 per sf full service, and adds that the Homeport Marina Building in Downtown Kirkland has also exceeded the $50 benchmark.

Overall, the report states that class A rental rates in the Puget Sound region, which is experiencing a record low 2.5% vacancy rate, is averaging $35.42 per sf, and shows no signs of tapering off.

While Seattle area developers currently have roughly 6.5 million sf of space currently under construction, with another 15.5 million sf of space in the proposed or planning stages, the Grubb & Ellis report predicts a balance between supply and demand remains many months off for the Puget Sound area, unless there is an unforeseen drop in demand from the high-tech sector.

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